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**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**FORM      10-K**

**x**
** **

**o**

**CHARMING      SHOPPES, INC.**

|   | **PENNSYLVANIA**                                                              |   | **23-1721355**                                      |   |
|--------|-------------------------------------------------------------------------------|--------|-----------------------------------------------------|--------|
|   | (State                or other jurisdiction of incorporation or organization) |   | (I.R.S.                Employer Identification No.) |   |

|   | **450                WINKS LANE, BENSALEM, PA 19020**              |   | **(215)                245-9100**                                         |   |
|--------|--------------------------------------------------------------------|--------|---------------------------------------------------------------------------|--------|
|   | (Address                of principal executive offices) (Zip Code) |   | (Registrant’s                telephone number, including Area Code) |   |

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| Large                Accelerated Filer x | Accelerated                Filer o | Non-accelerated                Filer o |
|------------------------------------------|------------------------------------|----------------------------------------|

**DOCUMENTS      INCORPORATED BY REFERENCE**

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**CHARMING      SHOPPES, INC.**

**200**
**6      FORM 10-K ANNUAL REPORT**

**TABLE      OF CONTENTS**

|                   |                                                                                                                                              | **Page** |
|------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------|----------|
|                   | **PART                I**                                                                                                                         |     |
|                   |                                                                                                                                              |     |
| Item                1  | Business                                                                                                                                          | 1        |
|                   | General                                                                                                                                           | 1        |
|                   | Retail                Stores Segment                                                                                                              | 2        |
|                   | Direct-to-Consumer                Segment                                                                                                         | 6        |
|                   | Proprietary                Credit Programs                                                                                                        | 9        |
|                   | Competition                                                                                                                                       | 10       |
|                   | Employees                                                                                                                                         | 10       |
|                   | Trademarks                and Servicemarks                                                                                                        | 10       |
|                   | Executive                Offices                                                                                                                  | 11       |
|                   | Available                Information                                                                                                              | 11       |
| Item                1A | Risk                Factors                                                                                                                       | 11       |
|                   | Risks                Related to Our Business and Industry                                                                                         | 11       |
|                   | Other                Risks                                                                                                                        | 16       |
| Item                1B | Unresolved                Staff Comments                                                                                                          | 17       |
| Item                2  | Properties                                                                                                                                        | 17       |
| Item                3  | Legal                Proceedings                                                                                                                  | 19       |
| Item                4  | Submission                of Matters to a Vote of Security Holders                                                                                | 19       |
|                   | Additional                Part I Information - Our Executive Officers                                                                             | 19       |
|                   |                                                                                                                                              |     |
|                   | **PART                II**                                                                                                                        |     |
|                   |                                                                                                                                              |     |
| Item                5  | Market                for Registrant’s Common Equity, Related Stockholder Matters, and Issuer                Purchases of Equity Securities | 21       |
| Item                6  | Selected                Financial Data                                                                                                            | 23       |
| Item                7  | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations                         | 25       |
|                   | Forward-Looking                Statements                                                                                                         | 25       |
|                   | Overview                                                                                                                                          | 27       |
|                   | Critical                Accounting Policies                                                                                                       | 29       |
|                   | Recent                Developments                                                                                                                | 35       |
|                   | Results                of Operations                                                                                                              | 36       |
|                   | Financial                Condition                                                                                                                | 45       |
|                   | Market                Risk                                                                                                                        | 53       |
|                   | Impact                of Recent Accounting Pronouncements                                                                                         | 53       |
| Item                7A | Quantitative                and Qualitative Disclosures About Market Risk                                                                         | 53       |
| Item                8  | Financial                Statements and Supplementary Data                                                                                        | 54       |
|                   | Management’s                Report on Internal Control Over Financial Reporting                                                             | 54       |
|                   | Report                of Independent Registered Public Accounting Firm on Internal Control                over                Financial Reporting | 55       |
|                   | Report                of Independent Registered Public Accounting Firm                                                                            | 57       |
|                   | Consolidated                Balance Sheets                                                                                                        | 58       |
|                   | Consolidated                Statements of Operations and Comprehensive Income                                                                     | 59       |

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**TABLE      OF CONTENTS**

**(Continued)**

|                   |                                                                                                                         | **Page**  |
|------------------------|------------------------------------------------------------------------------------------------------------------------------|-----------|
|                   |                                                                                                                         |      |
|                   | Consolidated                Statements of Stockholders’ Equity                                                         | 60        |
|                   | Consolidated                Statements of Cash Flows                                                                         | 61        |
|                   | Notes                to Consolidated Financial Statements                                                                    | 62        |
| Item                9  | Changes                In and Disagreements With Accountants on Accounting and Financial                Disclosure           |  102 |
| Item                9A | Controls                and Procedures                                                                                       | 102       |
| Item                9B | Other                Information                                                                                             | 103       |
|                   |                                                                                                                         |      |
|                   | **PART                III**                                                                                                  |      |
|                   |                                                                                                                         |      |
| Item                10 | Directors                and Executive Officers of the Registrant                                                            | 104       |
| Item                11 | Executive                Compensation                                                                                        | 104       |
| Item                12 | Security                Ownership of Certain Beneficial Owners and Management and Related                Stockholder Matters |  104 |
| Item                13 | Certain                Relationships and Related Transactions                                                                | 105       |
| Item                14 | Principal                Accountant Fees and Services                                                                        | 105       |
|                   |                                                                                                                         |      |
|                   | **PART                IV**                                                                                                   |      |
|                   |                                                                                                                         |      |
| Item                15 | Exhibits                and Financial Statement Schedules                                                                    | 106       |
|                   |                                                                                                                         |      |
|                   | Signatures                                                                                                                   | 116       |
|                   |                                                                                                                         |      |
|                   | Exhibit                Index                                                                                                 | 117       |

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**PART      I**

**Item      1. Business**

**GENERAL**

***LANE      BRYANT***
**-      **
**lanebryant.com**

***FASHION      BUG***
**fashionbug.com**

***CATHERINES      PLUS SIZES***
**catherines.com**

***CROSSTOWN      TRADERS***
**OLD      PUEBLO TRADERS**
**(R)**

**BEDFORD      FAIR LIFESTYLES**
**TM**

**BEDFORD      FAIR SHOESTYLES**
**TM**

**WILLOW      RIDGE**
**TM**

**LEW      MAGRAM**
**(R)**

**BROWNSTONE      STUDIO**
**(R)**

**REGALIA**
**(R)**

**INTIMATE      APPEAL**
**(R)**

**MONTEREY      BAY CLOTHING COMPANY**
**(R)**

**,      HOME ETC.**
**      TM**

**COWARD**
**(R)**

**      SHOE**
**FIGI’S**
**(R)**

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**“Item      8. Financial Statements and Supplementary Data: Notes to Consolidated Financial      Statements; **
**NOTE      19. SEGMENT REPORTING**
**”**

**RETAIL      STORE****S      SEGMENT**

***Stores***

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|                                                                                                                                                                                                                                  |   | **Year                Ended** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|--------|
|                                                                                                                                                                                                                                  |   | **Jan.                28,**   |   | **Jan.                29,** |   | **Jan.                31,** |   | **Feb.                1,** |   | **Feb.                2,** |   |
|                                                                                                                                                                                                                                  |   | **2006**                (1)   |   | **2005** |   | **2004** |   | **2003** |   | **2002** |   |
| **Store                Activity:**                                                                                                                                                                                                    |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Number                of stores open at beginning of period                                                                                                                                                                           |   |                          | 2,221  |   |   | 2,227 |   |   | 2,248 |   |   | 2,446 |   |   | 1,755 |   |
| Opened                during period                                                                                                                                                                                                   |   |                          | 70     |   |   | 51 |   |   | 50 |   |   | 57 |   |   | 125 |   |
| Acquired                during period                                                                                                                                                                                                 |   |                          | 0      |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 651 |   |
| Closed                during period                                                                                                                                                                                                   |   |                          | (55    | ) |   | (57 | ) |   | (71 | ) |   | (255 | )(2)  |   | (85 | ) |
| Number                of stores open at end of period                                                                                                                                                                                 |   |                          | 2,236  |   |   | 2,221 |   |   | 2,227 |   |   | 2,248 |   |   | 2,446 |   |
|                                                                                                                                                                                                                                  |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Number                of Stores by Brand:**                                                                                                                                                                                         |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| FASHION                BUG                                                                                                                                                                                                            |   |                          | 1,025  |   |   | 1,028 |   |   | 1,051 |   |   | 1,083 |   |   | 1,252 |   |
| LANE                BRYANT                                                                                                                                                                                                            |   |                          | 748    |   |   | 722 |   |   | 710 |   |   | 689 |   |   | 647 |   |
| CATHERINES                                                                                                                                                                                                                            |   |                          | 463    |   |   | 471 |   |   | 466 |   |   | 467 |   |   | 461 |   |
| Discontinued                brands (3)                                                                                                                                                                                                |   |                          | 0      |   |   | 0 |   |   | 0 |   |   | 9 |   |   | 86 |   |
| Number                of stores open at end of period                                                                                                                                                                                 |   |                          | 2,236  |   |   | 2,221 |   |   | 2,227 |   |   | 2,248 |   |   | 2,446 |   |
| ____________________                                                                                                                                                                                                                  |   |                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Does                not include 3 outlet stores operated by Crosstown Traders,                Inc.                                                                                                                           |
| (2) Includes                124 FASHION BUG stores and 68 ADDED DIMENSIONS(R)                stores that were closed in connection with a restructuring plan announced                on January 28, 2002.                       |
| (3) Includes                THE ANSWER(R)                and ADDED DIMENSIONS stores closed during Fiscal 2003, and                MONSOON(R)                and ACCESSORIZE(R)                stores closed during Fiscal 2004. |

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***Merchandising      and Buying***

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***Marketing      and Promotions***

**“Item      7. Management’s Discussion and Analysis of Financial Condition and Results of      Operations; **
**CRITICAL      ACCOUNTING POLICIES**
**;      **
***Revenue      Recognition***
**”**

**FIGURE**
**(R)**

**FIGURE**

***Sourcing***

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***Distribution      and Logistics***

**DIRECT-TO-CONSUMER      SEGMENT**

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***Merchandising      and Buying***

***Marketing      and Promotions***

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***Sourcing***

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***Distribution      and Logistics***

***Proprietary      Credit Programs***

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**“Item      7. Management’s Discussion and Analysis of **
**Financial      Condition and Results of Operations; **
**FINANCIAL      CONDITION**
**;      **
***Off-Balance-Sheet      Arrangements***
**”**
**“Item      8. Financial Statements and Supplementary Data: Notes to Consolidated Financial      Statements; **
**NOTE      17. ASSET SECURITIZATION**
**”**

**COMPETITION**

**EMPLOYEES**

**TRADEMARKS      AND SERVICEMARKS**

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**catherines.com,      charming.com, charmingshoppes.com, fashionbug.com, fashionbugcard.com,      fashionbugplus.com, figuremag.com, lanebryant.com, figis.com, bedfordfair.com,      brownstonestudio.com, cowardshoe.com, intimateappeal.com, lewmagram.com,      willowridgecatalog,com, oldpueblotraders.com, regaliaonline.com, shoetrader.com,      shopthebay.us,**

**EXECUTIVE      OFFICES**

**AVAILABLE      INFORMATION**

**www.charmingshoppes.com**
**www.sec.gov**
**“PART      III**
**Item      10. Directors and Executive Officers of the Registrant”**

**Item      1A. Risk Factors**

**“Item      7. Management’s Discussion and Analysis of **
**Financial      Condition and Results of Operations”**

**RISKS      RELATED TO OUR BUSINESS AND INDUSTRY**

***Our      business is dependent upon our ability to accurately predict rapidly changing      fashion trends, customer preferences, and other fashion-related      factors.***

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***Existing      and increased competition in the women's retail apparel and direct-to-consumer      markets may reduce our net revenues, profits, and market      share.***

***A      slowdown in the United States economy, an uncertain economic outlook, and      escalating energy costs could lead to reduced consumer demand for our products      in the future.***

***Maintaining      and improving our operating margins is dependent on our ability to successfully      control our operating costs.***

***Our      operating results fluctuate from season to season.***

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***We      may not be able to obtain sufficient working capital      financing.***

***We      face challenges in managing our recent growth.***

***We      depend on key personnel and may not be able to retain or replace these employees      or recruit additional qualified personnel.***

***Our      business plan is largely dependent upon continued growth in the plus-size      women’s apparel market.***

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***We      could be materially and adversely affected if any of our distribution or      fulfillment centers are shut down.***

***Natural      disasters, war, acts of terrorism, or the threat of either may negatively impact      the availability of merchandise and otherwise adversely impact our      business.***

***Our      inability to successfully manage customer service or fulfillment for our      E-commerce websites or our catalog business could adversely impact our operating      results.***

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***We      rely on foreign sources of production.***

| ●  | political                instability;                                                                             |
|---------------|------------------------------------------------------------------------------------------------------------------------|
| ●       | increased                security requirements applicable to imported goods;                                      |
| ●       | trade                restrictions;                                                                                |
| ●       | imposition                of, or changes in, duties, quotas, taxes, and other charges on                imports;  |
| ●       | currency                and exchange risks;                                                                       |
| ●       | issues                relating to compliance with domestic or international labor                standards;       |
| ●       | concerns                over anti-dumping,                                                                        |
| ●       | delays                in shipping; or                                                                             |
| ●       | increased                costs of transportation.                                                                 |

***Issues      of global workplace conditions may adversely affect our      business.***

***We      depend on strip shopping center and mall traffic and our ability to identify      suitable store locations for our Retail Stores      segment.***

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***We      may be unable to protect our trademarks and other intellectual property rights.***

**OTHER      RISKS**

***Anti-takeover      provisions in our governing documents and Pennsylvania law may discourage other      companies from attempting to acquire us.***

| ●  | classify                our board into three classes, with one class being elected each                year;                                                                                                                                             |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ●       | do                not permit cumulative voting;                                                                                                                                                                                                          |
| ●       | permit                our board to issue "blank check" preferred stock without shareholder                approval;                                                                                                                                      |
| ●       | require                certain advance notice procedures with regard to the nomination of                candidates for election as directors, other than nominations by or                at the                direction of our board;                 |
| ●       | prohibit                us from engaging in some types of business combinations with a holder                of                10% or more of our voting securities without super-majority shareholder                or                board approval;  |
| ●       | prevent                our directors from being removed without cause except upon super-majority                shareholder approval; and                                                                                                                |
| ●       | prevent                a holder of 20% or more of our common stock from taking certain actions                without certain approvals.                                                                                                                 |

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***Failure      to comply with the provisions of the Sarbanes-Oxley Act of 2002 could adversely      affect our business.***

***New      accounting rules or regulations or changes in existing rules or regulations      could adversely impact our reported results of      operations.***

***Changes      in estimates related to our property, plant, equipment, or our intangible assets      could adversely affect our reported results of      operations.***

**Item      1B. Unresolved Staff Comments**

**Item      2. Properties**

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| **Period**                                                                       | **Number                of****Leases                Expiring**(1) |
|----------------------------------------------------------------------------------|-------------------------------------------------------------------|
|                                                                             |                                                              |
| 2006                                | 205(2)                                                       |
| 2007                - 2011          | 652                                                               |
| 2012                - 2016          | 439                                                               |
| 2017                - 2021          | 445                                                               |
| 2022                - 2026          | 422                                                               |
| 2027                - 2031          | 56                                                                |
| Thereafter                          | 17                                                                |
| ____________________                                                             |
| (1) Excludes                3 Crosstown Traders outlet stores               |
| (2) Includes                142 stores on month-to-month leases             |

| **Size                in**                                                                                                                                                                                                            |                              | **Leased/** |                                                                                                                                |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------|-------------|-------------------------------------------------------------------------------------------------------------------------------------|
| **Sq.                Feet**                                                                                                                                                                                                           | **Location**                      | **Owned**   | **Description**                                                                                                                     |
|                                                                                                                                                                                                                                  |                              |        |                                                                                                                                |
| 1,000,000                                                                                                                                                                                                                             | Greencastle,                IN    | Owned       | FASHION                BUG distribution center                                                                                      |
| 393,000                                                                                                                                                                                                                               | White                Marsh, MD    | Owned       | LANE                BRYANT and CATHERINES distribution center                                                                       |
| 240,000                                                                                                                                                                                                                               | Tucson,                AZ         | Leased      | Crosstown                Traders distribution center                                                                                |
| 240,000                                                                                                                                                                                                                               | Wilmington,                NC     | Leased      | Crosstown                Traders distribution center                                                                                |
| 213,000                                                                                                                                                                                                                               | Memphis,                TN        | Owned       | Warehouse                facility (currently leased to a third party)                                                               |
| 145,000                                                                                                                                                                                                                               | Bensalem,                PA       | Owned       | Corporate                technology center, LANE BRYANT OUTLET operations,                and corporate administrative offices |
| 142,000                                                                                                                                                                                                                               | Bensalem,                PA       | Leased      | Corporate                headquarters/FASHION BUG operations                                                                        |
| 135,000                                                                                                                                                                                                                               | Columbus,                OH       | Leased      | LANE                BRYANT home office(1)                                                                                           |
| 130,000                                                                                                                                                                                                                               | Marshfield,                WI     | Owned       | Crosstown                Traders distribution center                                                                                |
| 129,000                                                                                                                                                                                                                               | Stevens                Point, WI  | Leased      | Crosstown                Traders distribution and call centers                                                                      |
| 100,000                                                                                                                                                                                                                               | Tucson,                AZ         | Leased      | Crosstown                Traders distribution center                                                                                |
| 63,000                                                                                                                                                                                                                                | Memphis,                TN        | Owned       | CATHERINES                home office                                                                                               |
| 63,000                                                                                                                                                                                                                                | Marshfield,                WI     | Owned       | Crosstown                Traders administrative offices and call center                                                             |
| 60,000                                                                                                                                                                                                                                | Phoenix,                AZ        | Leased      | Crosstown                Traders manufacturing facility                                                                             |
| 46,000                                                                                                                                                                                                                                | Neillsville,                WI    | Owned       | Crosstown                Traders distribution center                                                                                |
| 45,000                                                                                                                                                                                                                                | Tucson,                AZ         | Leased      | Crosstown                Traders offices                                                                                            |
| 40,000                                                                                                                                                                                                                                | Greenwich,                CT      | Leased      | Crosstown                Traders offices                                                                                            |
| 23,000                                                                                                                                                                                                                                | Hong                Kong, PRC     | Owned       | International                sourcing offices                                                                                       |
| 13,000                                                                                                                                                                                                                                | Hong                Kong, PRC     | Leased      | International                sourcing warehouse and offices                                                                         |
| 30,000                                                                                                                                                                                                                                | Miami                Township, OH | Leased      | Spirit                of America National Bank (our wholly-owned credit card bank                subsidiary) and credit operations  |
| 22,000                                                                                                                                                                                                                                | Carlsbad,                CA       | Leased      | Crosstown                Traders offices                                                                                            |
| 17,000                                                                                                                                                                                                                                | New                York, NY       | Leased      | E-commerce                operations                                                                                                |
| ____________________                                                                                                                                                                                                                  |
| (1) During                Fiscal 2006, we relocated our LANE BRYANT home office from a 130,000                square-foot leased facility in Reynoldsburg, Ohio to the facility                in                Columbus, Ohio. |

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**Item      3. Legal Proceedings**

**Item      4. Submission of Matters to a Vote of Security Holders**

**Additional      Part I Information - Our Executive Officers**

**Dorrit      J. Bern**

**Joseph      M. Baron**

**James      G. Bloise**

**Michel      Bourlon**

**Anthony      A. DeSabato**

**Eric      M. Specter**
**-      **

**Colin      D. Stern**

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**Gale      H. Varma,**

**Jonathon      Graub**
**-      **

**John      J. Sullivan**
**-      **

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**PART      II**

**Item      5. Market for the Registrant’s Common Equity, Related Stockholder Matters, and      Issuer Purchases of Equity Securities**

|                       |   | **Fiscal                2006** |   | **Fiscal                2005** |   |
|----------------------------|--------|--------------------------------|--------|--------------------------------|--------|
|                       |   | **High**                       |   | **Low**                        |   | **High** |   | **Low** |   |
|                       |   |                           |   |                           |   |   |   |   |   |   |   |   |   |
| 1st                Quarter |   | $                              | 9.03   |                           | $      | 7.04 |   | $ | 8.22 |   | $ | 5.70 |   |
| 2nd                Quarter |   |                           | 12.25  |                           |   | 7.00 |   |   | 9.19 |   |   | 6.48 |   |
| 3rd                Quarter |   |                           | 12.34  |                           |   | 9.69 |   |   | 7.73 |   |   | 6.23 |   |
| 4th                Quarter |   |                           | 14.07  |                           |   | 10.86 |   |   | 9.64 |   |   | 7.55 |   |

**“Item      7. Management’s Discussion and Analysis of Financial Condition and Results of      Operations; **
**FINANCIAL      CONDITION**
**;      Financing; **
***Long-term      Debt and Equity Financing***
**”**
**“Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; **
**NOTE      8. SHORT-TERM BORROWINGS AND LONG-TERM DEBT**
**”**

**“Item      12. Security Ownership of Certain Beneficial Owners and Management and Related      Stockholder Matters”**

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   | **Total**                           |   | **Maximum**                        |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|-----------------------------------------|-------------------------------|--------|-------------------------------------|--------|------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   | **Number**                          |   | **Number                of**       |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   | **of                Shares**        |   | **Shares                that**     |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | **Total**                    |                                    |                          |   | **Purchased                as**     |   | **May                Yet be**      |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | **Number**                   |                                    | **Average**                   |   | **Part                of Publicly** |   | **Purchased**                      |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | **of                Shares** |                                    | **Price                Paid** |   | **Announced                Plans**  |   | **Under                the Plans** |   |
| **Period**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | **Purchased**                |                                    | **per                Share**  |   | **or                Programs**(2)   |   | **or                Programs**(2)  |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   |                                |   |                               |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   |                                |   |                               |   |   |   |   |   |
| October                  30, 2005 through November 26, 2005                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                         | 550(1)                                  |                          | $      | 11.20(1)                            |   |                               | -      |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   |                                |   |                               |   |   |   |   |   |
| November                  27, 2005 through December 31, 2005                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                         | -                                       |                          |   | -                                   |   |                               | -      |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   |                                |   |                               |   |   |   |   |   |
| January                  1, 2006 through January 28, 2006                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                         | 696(1)                                  |                          |   | 12.65(1)                            |   |                               | -      |   |   |   |   |
| Total                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                         | 1,246                    |                          | $      | 12.01           |   |                               | -      |   |   |   |   |
| ____________________                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                         |                                    |                          |   |                                |   |                               |   |   |   |   |   |
|                      (1) Shares                withheld for the payment of payroll taxes on employee stock awards                that                vested during the period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   (2) In                Fiscal 1998, we publicly announced that our Board of Directors granted                authority to repurchase up to 10,000,000 shares of our common stock.                In                Fiscal 2000, we publicly announced that our Board of Directors granted                authority to repurchase up to an additional 10,000,000 shares of                our                common stock. In Fiscal 2003, the Board of Directors granted an additional                authorization to repurchase 6,350,662 shares of common stock issued                to                Limited Brands in connection with our acquisition of LANE BRYANT.                From                Fiscal 1998 through Fiscal 2003, we repurchased a total of 21,370,993                shares of common stock, which included shares purchased on the open                market                as well as shares repurchased from Limited Brands. As of January                28 2006                4,979,669 shares of our common stock remain available for repurchase                under                these programs. Our revolving credit facility allows the repurchase                of our                common stock subject to maintaining a minimum level of Excess Availability                (as defined in the facility agreement) immediately before and after                such                repurchase. As conditions may allow, we may from time to time acquire                additional shares of our common stock under these programs. Such                shares,                if purchased, would be held as treasury shares. No shares were acquired                under these programs during the thirteen weeks ended January 28,                2006. The                repurchase programs have no expiration                date. |

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Table            of Contents

**Item      6. Selected Financial Data**

**“Item      7. Management’s Discussion and Analysis of Financial Condition and Results of      Operations”**
**“Item      8. Financial Statements and Supplementary Data.”**

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**FIVE-YEAR      COMPARATIVE SUMMARY**

|                                                                          |   | **Year                Ended** |      |
|-------------------------------------------------------------------------------|--------|-------------------------------|-----------|
|                                                                          |   | **Jan.                28,**   |      | **Jan.                29,** |   | **Jan.                31,** |   | **Feb.                1,** |   | **Feb.                2,** |   |
| **(Dollars                in thousands, except per share amounts)**           |   | **2006****(1)**               |      | **2005****(2)** |   | **2004****(2)** |   | **2003****(2)** |   | **2002****(2)                (3)** |   |
|                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Operating                Statement Data:**                                  |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                sales                                                 |   | $                             | 2,755,725 |   | $ | 2,334,736 |   | $ | 2,288,363 |   | $ | 2,413,356 |   | $ | 1,995,785 |   |
|                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost                of goods sold, buying, catalog, and                       |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| occupancy                expenses                                             |   |                          | 1,911,275 |   |   | 1,642,650 |   |   | 1,645,499 |   |   | 1,727,253 |   |   | 1,462,198 |   |
| Selling,                general, and administrative expenses             |   |                          | 683,231   |   |   | 577,301 |   |   | 558,248 |   |   | 603,502 |   |   | 486,204 |   |
| Amortization                of goodwill                                  |   |                          | 0         |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 4,885 |   |
| Expenses                related to cost reduction plan                   |   |                          | 0         |   |   | 605 | (4) |   | 11,534 | (4) |   | 0 |   |   | 0 |   |
| Restructuring                charge (credit)                             |   |                          | 0         |   |   | 0 |   |   | 0 |   |   | (4,813 | )(5) |   | 37,708 | (5) |
| Total                operating expenses                                  |   |                          | 2,594,506 |   |   | 2,220,556 |   |   | 2,215,281 |   |   | 2,325,942 |   |   | 1,990,995 |   |
| Income                from operations                                    |   |                          | 161,219   |   |   | 114,180 |   |   | 73,082 |   |   | 87,414 |   |   | 4,790 |   |
| Other                income                                              |   |                          | 9,093     |   |   | 3,098 |   |   | 2,050 |   |   | 2,328 |   |   | 4,730 |   |
| Interest                expense                                          |   |                          | (17,911   | ) |   | (15,610 | ) |   | (15,609 | ) |   | (20,292 | ) |   | (18,701 | ) |
| Income                (loss) before income taxes, minority interest,          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and                cumulative effect of accounting changes                    |   |                          | 152,401   |   |   | 101,668 |   |   | 59,523 |   |   | 69,450 |   |   | (9,181 | ) |
| Income                tax provision (benefit)                            |   |                          | 53,010    |   |   | 37,142 |   |   | 21,623 |   |   | 27,117 |   |   | (1,838 | ) |
| Income                (loss) before minority interest and cumulative          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| effect                of accounting changes                                   |   |                          | 99,391    |   |   | 64,526 |   |   | 37,900 |   |   | 42,333 |   |   | (7,343 | ) |
| Minority                interest in net loss of consolidated subsidiary  |   |                          | 0         |   |   | 0 |   |   | 142 |   |   | 679 |   |   | 0 |   |
| Cumulative                effect of accounting changes, net of tax       |   |                          | 0         |   |   | 0 |   |   | 0 |   |   | (49,098 | )(6) |   | 0 |   |
| Net                income (loss)                                         |   | $                             | 99,391    |   | $ | 64,526 |   | $ | 38,042 |   | $ | (6,086 | ) | $ | (7,343 | ) |
|                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                net income (loss) per share:                             |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Before                cumulative effect of accounting changes                 |   | $                             | .83       |   | $ | .56 |   | $ | .34 |   | $ | .38 |   | $ | (.07 | ) |
| Net                income (loss)                                              |   |                          | .83       |   |   | .56 |   |   | .34 |   |   | (.05 | ) |   | (.07 | ) |
| Basic                weighted average common shares outstanding          |   |                          | 119,831   |   |   | 116,196 |   |   | 112,491 |   |   | 113,810 |   |   | 105,842 |   |
|                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                net income (loss) per share:                           |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Before                cumulative effect of accounting changes                 |   | $                             | .76       |   | $ | .52 |   | $ | .33 |   | $ | .36 |   | $ | (.07 | ) |
| Net                income (loss)                                              |   |                          | .76       |   |   | .52 |   |   | .33 |   |   | (.01 | ) |   | (.07 | ) |
| Diluted                weighted average common shares and                     |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| equivalents                outstanding                                        |   |                          | 137,064   |   |   | 133,174 |   |   | 128,558 |   |   | 130,937 |   |   | 105,842 |   |
|                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**FIVE-YEAR      COMPARATIVE SUMMARY**

**(Continued)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **Year                Ended** |      |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|-----------|
| **(Dollars                in thousands)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | **Jan.                28,**   |      | **Jan.                29,** |   | **Jan.                31,** |   | **Feb.                1,** |   | **Feb.                2,** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **2006****(1)**               |      | **2005** |   | **2004** |   | **2003** |   | **2002****(3)** |   |
| **Balance                Sheet Data:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | $                             | 1,566,995 |   | $ | 1,303,771 |   | $ | 1,173,070 |   | $ | 1,139,564 |   | $ | 1,147,911 |   |
| Current                portion - long-term debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          | 14,765    |   |   | 16,419 |   |   | 17,278 |   |   | 12,595 |   |   | 9,379 |   |
| Long-term                debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                          | 191,979   |   |   | 208,645 |   |   | 202,819 |   |   | 203,045 |   |   | 208,491 |   |
| Working                capital                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                          | 338,641   |   |   | 413,989 |   |   | 266,178 |   |   | 190,797 |   |   | 119,873 |   |
| Stockholders’                equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                          | 814,348   |   |   | 694,464 |   |   | 587,409 |   |   | 546,555 |   |   | 538,039 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Performance                Data:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Including                cumulative effect of accounting changes:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                return on average stockholders’ equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                          | 13.2      | % |   | 10.1 | % |   | 6.7 | % |   | (1.1 | )% |   | (1.4 | )% |
| Net                return on average total assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                          | 6.9       |   |   | 5.2 |   |   | 3.3 |   |   | (0.5 | ) |   | (0.7 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Before                cumulative effect of accounting changes:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                return on average stockholders’ equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                          | 13.2      | % |   | 10.1 | % |   | 6.7 | % |   | 7.6 | % |   | (1.4 | )% |
| Net                return on average total assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                          | 6.9       |   |   | 5.2 |   |   | 3.3 |   |   | 3.7 |   |   | (0.7 | ) |
| ____________________                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Includes                the results of operations of Crosstown Traders, Inc. from the date                of                acquisition (June 2, 2005).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (2) Certain                prior-year amounts have been reclassified to conform to the current-year                presentation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (3) Includes                the results of operations of Lane Bryant, Inc., from the date of                acquisition (August 16, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| (4) In                March 2003, we announced a cost reduction plan designed to take advantage                of the centralization of corporate administrative services and to                realize                certain efficiencies, in order to improve profitability. For details                of                the program, see **“Item                8. Financial Statements and Supplementary Data; Notes to Consolidated                Financial Statements;****NOTE                15. EXPENSES RELATED TO COST REDUCTION PLAN****”**                below.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (5) In                January 2002, our Board of Directors approved a restructuring plan                that                included the closing of THE ANSWER/ADDED DIMENSIONS chain of 77 stores;                the conversion of approximately 20% of the ADDED DIMENSIONS stores                to                CATHERINES stores; the closing of 130 under-performing FASHION BUG                stores;                and the conversion of 44 FASHION BUG stores to LANE BRYANT stores.                This                restructuring plan resulted in a pre-tax charge of $37,708,000 in                Fiscal                2002. We completed the restructuring plan by the end of Fiscal 2003,                and                recognized a pre-tax restructuring credit of $4,813,000, primarily                as a                result of favorable negotiations of lease terminations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| (6) In                Fiscal 2003, we fully adopted the provisions of SFAS No. 142, *“Goodwill                and Other Intangible Assets*.*”*                In                accordance with the transition provisions of SFAS No. 142, we tested                goodwill related to our CATHERINES acquisition for impairment, and                recorded a write-down of $43,975,000 to reduce the carrying value                of the                goodwill to its estimated fair value. In addition, we recognized                a charge                of $5,123,000, net of income taxes of $2,758,000, in connection with                the                adoption of FASB Emerging Issues Task Force (“EITF”) Issue 02-16,                *“Accounting                by a Customer (Including a Reseller) for Certain Consideration Received                from a Vendor*.***”***** **                This charge represents a reduction in inventory cost for the cumulative                effect of cash received from vendors as of the beginning of Fiscal                2003.                Pro forma net loss, basic net loss per share, and diluted net loss                per                share for the fiscal year ended February 2, 2002, as if we had applied                the                provisions of EITF Issue 02-16, were ($8,126), ($.08), and ($.08),                respectively. |

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**Item      7. Management’s Discussion and Analysis of Financial Condition and Results of      Operations**

**FORWARD-LOOKING      STATEMENTS**

**“Item      1A. Risk Factors,”**

| ●  | Our                business is dependent upon our ability to accurately predict rapidly                changing fashion trends, customer preferences, and other fashion-related                factors, which we may not be able to successfully accomplish in the                future.                                   |
|---------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ●       | A                slowdown in the United States economy, an uncertain economic outlook,                and                escalating energy costs could lead to reduced consumer demand for                our                products in the future.                                                                        |
| ●       | The                women’s specialty retail apparel and direct-to-consumer markets are highly                competitive and we may be unable to compete successfully against                existing                or future competitors.                                                                           |
| ●       | We                may be unable to successfully integrate the operations of Crosstown                Traders, Inc. with the operations of Charming Shoppes, Inc. In addition,                we cannot assure the successful implementation of our business plan                for                Crosstown Traders, Inc.  |
| ●       | We                cannot assure the successful implementation of our business plan                for                increased profitability and growth in our Retail Stores or                Direct-to-Consumer segments.                                                                                                 |
| ●       | Our                business plan is largely dependent upon continued growth in the plus-size                women’s apparel market, which may not occur.                                                                                                                                                              |
| ●       | We                depend on key personnel, particularly our Chief Executive Officer,                Dorrit                J. Bern, and we may not be able to retain or replace these employees                or                recruit additional qualified personnel.                                                     |

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| ● | We                depend on our distribution and fulfillment centers, and could incur                significantly higher costs and longer lead times associated with                distributing our products to our stores and shipping our products                to our                E-commerce and catalog customers if operations at any of these                distribution and fulfillment centers were to be disrupted for any                reason.                                                                                                                                                                                                                                             |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ● | We                depend on the availability of credit for our working capital needs,                including credit we receive from our suppliers and their agents,                and on                our credit card securitization facilities. If we were unable to obtain                sufficient financing at an affordable cost, our ability to merchandise                our                stores, E-commerce, or catalog businesses would be adversely                affected.                                                                                                                                                                                                                |
| ● | Natural                disasters, as well as war, acts of terrorism, or the threat of either                may                negatively impact availability of merchandise and customer traffic                to our                stores, or otherwise adversely affect our business.                                                                                                                                                                                                                                                                                                                                                                                                                     |
| ● | We                rely significantly on foreign sources of production and face a variety                of                risks generally associated with doing business in foreign markets                and                importing merchandise from abroad. Such risks include (but are not                necessarily limited to) political instability; imposition of, or                changes                in, duties or quotas; trade restrictions; increased security requirements                applicable to imports; delays in shipping; increased costs of                transportation; and issues relating to compliance with domestic or                international labor standards.  |
| ● | Our                Retail Stores and Direct-to-Consumer segments experience seasonal                fluctuations in net sales and operating income. Any decrease in sales                or                margins during our peak sales periods, or in the availability of                working                capital during the months preceding such periods, could have a material                adverse effect on our business. In addition, extreme or unseasonable                weather conditions may have a negative impact on our sales.                                                                                                                                                       |
| ● | We                may be unable to obtain adequate insurance for our operations at                a                reasonable cost.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| ● | We                may be unable to protect our trademarks and other intellectual property                rights, which are important to our success and our competitive position.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| ● | We                may be unable to hire and retain a sufficient number of suitable                sales                associates at our stores.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| ● | Our                manufacturers may be unable to manufacture and deliver merchandise                to us                in a timely manner or to meet our quality standards.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| ● | Our                Retail Stores segment sales are dependent upon a high volume of traffic                in                the strip centers and malls in which our stores are located, and                our                future retail store growth is dependent upon the availability of                suitable                locations for new stores.                                                                                                                                                                                                                                                                                                                                               |
| ● | Successful                operation of our E-Commerce websites and our catalog business is                dependent                on our ability to maintain efficient and uninterrupted customer service                and fulfillment operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| ● | We                may be unable to manage significant increases in certain costs, including                postage and paper, which could adversely affect our results of                operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| ● | Response                rates to our catalogs and access to new customers could decline,                which                would adversely affect our net sales and results of                operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| ● | We                may be unable to successfully implement our plan to improve merchandise                assortments in our Retail Stores or Direct-to-Consumer                segments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

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| ● | We                make certain significant assumptions, estimates, and projections                related                to the useful lives of our property, plant, and equipment and the                valuation of intangible assets related to acquisitions. The carrying                amount and/or useful life of these assets are subject to periodic                valuation tests for impairment. Impairment results when the carrying                value                of an asset exceeds the undiscounted (or for goodwill and indefinite-lived                intangible assets the discounted) future cash flows associated with                the                asset. If actual experience were to differ materially from the                assumptions, estimates, and projections used to determine useful                lives or                the valuation of property, plant, equipment, or intangible assets,                a                write-down for impairment of the carrying value of the assets, or                acceleration of depreciation or amortization of the assets, could                result.                Such a write-down or acceleration of depreciation or amortization                would                have an adverse impact on our reported results of operations.                     |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ● | Changes                to existing accounting rules or the adoption of new rules could have                an                adverse impact on our reported results of operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| ● | Pursuant                to Section 404 of the Sarbanes-Oxley Act of 2002, we are required                to                include our assessment of the effectiveness of our internal control                over                financial reporting in our annual reports. Our independent registered                public accounting firm is also required to attest to whether or not                our                assessment is fairly stated in all material respects and to separately                report on whether or not they believe that we maintained, in all                material                respects, effective internal control over financial reporting. If                we are                unable to maintain effective internal control over financial reporting,                or                if our independent registered public accounting firm is unable to                timely                attest to our assessment, we could be subject to regulatory sanctions                and                a possible loss of public confidence in the reliability of our financial                reporting. Such a failure could result in our inability to provide                timely                and/or reliable financial information and could adversely affect                our                business. |

**OVERVIEW**

**“RECENT      DEVELOPMENTS”**

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|   | · | Acceleration                of our new store opening plan, primarily in the LANE BRYANT brand.                Plans                for LANE BRYANT include expansion of the CACIQUE                intimate apparel brand through a new, larger side-by-side store concept,                which we successfully tested during Fiscal 2006. This new concept                pairs                LANE BRYANT’s casual and wear-to-work sportswear assortments with an                expanded line of CACIQUE                intimates, presented in a double store-front using the names CACIQUE                and LANE BRYANT. We plan to open approximately 60 new LANE BRYANT                stores                during Fiscal 2007, one-third of which will be in the CACIQUE                side-by-side                format. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In                Fiscal 2007, we will enter the outlet store channel through LANE                BRYANT                OUTLET,                with the opening of approximately 75-80 outlet stores in locations                acquired through the assumption of store leases from Retail Brand                Alliance. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In                our Direct-to-Consumer segment, we will continue to build infrastructure                to prepare for the launch of new catalog offerings, including the                launch                of the LANE BRYANT catalog. The LANE BRYANT catalog trademark, which                is                currently licensed to a third party, will revert to us in late Fiscal                2008. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In                addition, we are planning for continued growth in E-commerce,                international expansion, and the addition of cross-channel selling                tools. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**CRITICAL      ACCOUNTING POLICIES**

***Revenue      Recognition***

*“Revenue      Recognition.”*

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***Accounts      Receivable***

***Inventories***

***“***
***Accounting      for Cash Consideration Received From a Vendor”***

***Deferred      Catalog Advertising Costs***

catalog      is      mailed. These capitalized costs are subsequently amortized as a component of      cost of goods sold, buying, catalog, and occupancy expenses over the expected      sales realization cycle, generally within one to six months. Our initial      estimation of the expected sales realization cycle for a particularcatalog      merchandise offering is based on, among other possible considerations, our      historical sales and sell-through experience with similar catalog      merchandise offerings, our understanding of then-prevailing fashion trends      and      influences, our assessment of prevailing economic conditions, and various      competitive factors. We continually track our subsequent sales realization,      compile customer feedback for indications of future performance, reassess the      marketplace, compare our findings to our previous estimate, and adjust our      amortization accordingly.      A      significant change in our expected sales and sell-through experience could      have      a material impact on the rate of amortization of deferred catalog advertising      costs.

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***Impairment      of Property, Plant, and Equipment, Goodwill, and Intangible Assets***

*“Accounting      for the Impairment or Disposal of Long-Lived Assets*
*”*

*“Goodwill      and Other Intangible Assets.” *

***Acquisitions      - Purchase Price Allocation***

*“Business      Combinations.”*

***Asset      Securitization***

**“**
**Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; **
**NOTE      17. ASSET SECURITIZATION**
**”**

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*“Accounting      for Transfers and Servicing of Financial Assets and Extinguishments of      Liabilities,”*

| **(In                millions)**                 |   | **10%                Change** |   | **20%                Change** |   |
|--------------------------------------------------|--------|-------------------------------|--------|-------------------------------|--------|
|                                             |   |                          |   |                          |   |   |   |
| **Assumption:**                                  |   |                          |   |                          |   |   |   |
| Payment                rate                      |   | $                             | 1.0    |                          | $      | 1.9 |   |
| Residual                cash flows discount rate |   |                          | 0.1    |                          |   | 0.1 |   |
| Credit                loss percentage            |   |                          | 0.9    |                          |   | 1.8 |   |

***Costs      Associated With Exit or Disposal Activities***

*“Accounting      for Costs Associated with Exit or Disposal Activities,” *
**“Item      8. Financial Statements and Supplementary Data; Notes To Consolidated Financial      Statements; **
**NOTE      15. EXPENSES RELATED TO COST REDUCTION PLAN**
**”**

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***Accounting      for Cash Consideration Received From a Vendor***

*“Accounting      by a Customer (Including a Reseller) for Cash Consideration Received from a      Vendor,”*

***Stock-Based      Compensation***

*“Accounting      for Stock-Based Compensation,”*
*“Accounting      for Stock-Based Compensation - Transition and Disclosure,”*
*“Accounting      for Stock Issued to Employees,”*

*“Share-Based      Payment”*

**“**
**Item      8. Financial Statements and Supplementary Data; Note 1. Summary of Significant      Accounting Policies,”**

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***Insurance      Liabilities***

***Operating      Leases***

*“Accounting      for Leases.”*

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**RECENT****DEVELOPMENTS**

***Acquisition      of Crosstown Traders, Inc.***

**"FINANCING;      **
***Revolving      Credit Facility***
**"**

***Hurricane      Katrina***

***VISA/MasterCard      Antitrust Litigation***

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**RESULTS      OF OPERATIONS**

**Financial      Summary**

|                                                                                                                                                              |   |                                          |   |                               |   |       |   | **Percentage                Increase** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|--------|------------------------------------|--------|------------|--------|----------------------------------------|--------|
|                                                                                                                                                              |   |                                          |   |                               |   |       |   | **(Decrease)**                         |   |
|                                                                                                                                                              |   | **Percentage                of Net Sales**(1) |   | **From                Prior Year** |   |
|                                                                                                                                                              |   | **Fiscal**                                    |   | **Fiscal**                         |   | **Fiscal** |   | **Fiscal**                             |   | **Fiscal** |   |
|                                                                                                                                                              |   | **2006**(2)                                   |   | **2005**                           |   | **2004**   |   | **2006-2005**                          |   | **2005-2004** |   |
|                                                                                                                                                              |   |                                          |   |                               |   |       |   |                                   |   |   |   |   |   |   |   |   |
| Net                sales                                                                                                                                          |   |                                          | 100.0  | %                                  |   | 100.0      | %      |                                   | 100.0  | % |   | 18.0 | % |   | 2.0 | % |
| Cost                of goods sold, buying, catalog, and occupancy                                                                                                 |   |                                          | 69.4   |                               |   | 70.4       |   |                                   | 71.9   |   |   | 16.4 |   |   | (0.2 | ) |
| Selling,                general, and administrative                                                                                                               |   |                                          | 24.8   |                               |   | 24.7       |   |                                   | 24.4   |   |   | 18.3 |   |   | 3.4 |   |
| Expenses                related to cost reduction plan                                                                                                            |   |                                          | 0.0    |                               |   | 0.0        |   |                                   | 0.5    |   |   | (100.0 | ) |   | (94.8 | ) |
| Income                from operations                                                                                                                             |   |                                          | 5.9    |                               |   | 4.9        |   |                                   | 3.2    |   |   | 41.2 |   |   | 56.2 |   |
| Other                income                                                                                                                                       |   |                                          | 0.3    |                               |   | 0.1        |   |                                   | 0.1    |   |   | 193.5 |   |   | 51.1 |   |
| Interest                expense                                                                                                                                   |   |                                          | 0.6    |                               |   | 0.7        |   |                                   | 0.7    |   |   | 14.7 |   |   | 0.0 |   |
| Income                tax provision                                                                                                                               |   |                                          | 1.9    |                               |   | 1.6        |   |                                   | 0.9    |   |   | 42.7 |   |   | 71.8 |   |
| Net                income                                                                                                                                         |   |                                          | 3.6    |                               |   | 2.8        |   |                                   | 1.7    |   |   | 54.0 |   |   | 69.6 |   |
| ____________________                                                                                                                                              |   |                                          |   |                               |   |       |   |                                   |   |   |   |   |   |   |   |   |
| (1) Results                may not add due to rounding.                                                                                                      |
| (2) Includes                the results of operations of Crosstown Traders, Inc. from the date                of                acquisition on June 2, 2005. |

|                                                                                                                                                              |   | **Year                Ended**       |    | **Year                Ended**       |   | **Year                Ended**       |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|---------|-------------------------------------|--------|-------------------------------------|--------|
|                                                                                                                                                              |   | **January                28, 2006** |    | **January                29, 2005** |   | **January                31, 2004** |   |
|                                                                                                                                                              |   | **Fiscal**                          |    | **Fourth**                          |   | **Fiscal**                          |   | **Fourth** |   | **Fiscal** |   | **Fourth** |   |
| **(In                millions)**                                                                                                                                  |   | **Year**                            |    | **Quarter**                         |   | **Year**                            |   | **Quarter** |   | **Year** |   | **Quarter** |   |
|                                                                                                                                                              |   |                                |    |                                |   |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| FASHION                BUG                                                                                                                                        |   | $                                   | 1,049.4 |                                | $      | 258.6                               |   | $ | 1,043.8 |   | $ | 255.0 |   | $ | 1,056.6 |   | $ | 257.9 |   |
| LANE                BRYANT                                                                                                                                        |   |                                | 1,057.4 |                                |   | 299.8                               |   |   | 974.6 |   |   | 260.1 |   |   | 903.4 |   |   | 249.9 |   |
| CATHERINES                                                                                                                                                        |   |                                | 346.2   |                                |   | 83.0                                |   |   | 312.1 |   |   | 70.4 |   |   | 323.3 |   |   | 75.2 |   |
| Other(1)                                                                                                                                                          |   |                                | 0.0     |                                |   | 0.0                                 |   |   | 0.0 |   |   | 0.0 |   |   | 1.7 |   |   | 0.0 |   |
| Total                Retail Stores segment sales                                                                                                                  |   |                                | 2,453.0 |                                |   | 641.4                               |   |   | 2,330.5 |   |   | 585.5 |   |   | 2,285.0 |   |   | 583.0 |   |
| Total                Direct-to-Consumer segment sales(2)                                                                                                          |   |                                | 298.9   |                                |   | 155.8                               |   |   | 0.0 |   |   | 0.0 |   |   | 0.0 |   |   | 0.0 |   |
| Corporate                and other(3)                                                                                                                             |   |                                | 3.8     |                                |   | 2.4                                 |   |   | 4.2 |   |   | 2.5 |   |   | 3.4 |   |   | 0.9 |   |
| Total                net sales                                                                                                                                    |   | $                                   | 2,755.7 |                                | $      | 799.6                               |   | $ | 2,334.7 |   | $ | 588.0 |   | $ | 2,288.4 |   | $ | 583.9 |   |
| ____________________                                                                                                                                              |   |                                |    |                                |   |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Sales                attributable to MONSOON/ACCESSORIZE stores, which were closed during                the                first half of Fiscal 2004.   |
| (2) Includes                the results of operations of Crosstown Traders, Inc. from the date                of                acquisition on June 2, 2005. |
| (3) Primarily                revenue related to loyalty card                fees.                                                                            |

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **Year                Ended**       |   | **Year                Ended**       |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|--------|-------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **January                28, 2006** |   | **January                29, 2005** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **Fiscal**                          |   | **Fourth**                          |   | **Fiscal** |   | **Fourth** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **Year**                            |   | **Quarter**                         |   | **Year** |   | **Quarter** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| **Retail                Stores segment**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Increase                (decrease) in comparable store sales(1):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Consolidated                retail stores                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                | 3      | %                                   |   | 7 | % |   | 1 | % |   | (2 | )% |
| FASHION                BUG                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | 0      |                                |   | 1 |   |   | 1 |   |   | (1 | ) |
| LANE                BRYANT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | 4      |                                |   | 10 |   |   | 3 |   |   | (1 | ) |
| CATHERINES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | 10     |                                |   | 19 |   |   | (6 | ) |   | (9 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Sales                from new stores and E-commerce as a percentage                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| of                total consolidated prior-period sales:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| FASHION                BUG                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | 1      |                                |   | 1 |   |   | 1 |   |   | 1 |   |
| LANE                BRYANT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | 2      |                                |   | 3 |   |   | 2 |   |   | 2 |   |
| CATHERINES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | 1      |                                |   | 1 |   |   | 1 |   |   | 0 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Prior-period                sales from closed stores as a percentage                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| of                total consolidated prior-period sales:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| FASHION                BUG                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | (1     | )                                   |   | (1 | ) |   | (2 | ) |   | (2 | ) |
| LANE                BRYANT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | (1     | )                                   |   | (1 | ) |   | (1 | ) |   | (1 | ) |
| CATHERINES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                | (1     | )                                   |   | (1 | ) |   | 0 |   |   | 0 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Increase                in Retail Stores segment sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                | 5      |                                |   | 9 |   |   | 2 |   |   | 0 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| **Direct-to-Consumer                segment**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Sales                as a percentage of total consolidated                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| prior-period                sales(2)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                | 13     |                                |   | 27 |   |   | - |   |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| Increase                in consolidated total net sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                | 18     | %                                   |   | 36 | % |   | 2 | % |   | 0 | % |
| ____________________                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                |   |                                |   |   |   |   |   |   |   |   |   |
| (1) “Comparable                store sales” is not a measure that has been defined under generally                accepted accounting principles. The method of calculating comparable                store                sales varies across the retail industry and, therefore, our calculation                of                comparable store sales is not necessarily comparable to similarly-titled                measures reported by other companies. We define comparable store                sales as                sales from stores operating in both the current and prior-year periods.                New stores are added to the comparable store sales base 13 months                after                their open date. Sales from stores that are relocated within the                same mall                or strip-center, remodeled, or have a legal square footage change                of less                than 20% are included in the calculation of comparable store sales.                Sales                from stores that are relocated outside the existing mall or strip-center,                or have a legal square footage change of 20% or more, are excluded                from                the calculation of comparable store sales until 13 months after the                relocated store is opened. Stores that are temporarily closed for                a period                of 4 weeks or more are excluded from the calculation of comparable                store                sales for the applicable periods in the year of closure and the subsequent                year. Non-store sales, such as catalog and Internet sales, are excluded                from the calculation of comparable store sales.  |
| (2) Includes                catalog sales and catalog-related E-commerce sales from Crosstown                Traders,                Inc. from the date of acquisition on June 2,                2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

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|                                                                                                                                                                                       |   | **FASHION****BUG** |   | **LANE****BRYANT** |   | **CATHERINES** |   | **Total** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------------------|--------|----------------|--------|-----------|--------|
|                                                                                                                                                                                       |   |               |   |               |   |           |   |      |   |   |   |   |   |
| **Fiscal                2006****(1)**                                                                                                                                                      |   |               |   |               |   |           |   |      |   |   |   |   |   |
| Stores                at January 29, 2005                                                                                                                                                  |   |               | 1,028  |               |   | 722            |   |      | 471    |   |   | 2,221 |   |
|                                                                                                                                                                                       |   |               |   |               |   |           |   |      |   |   |   |   |   |
| Stores                opened                                                                                                                                                               |   |               | 19     |               |   | 45             |   |      | 6      |   |   | 70 |   |
| Stores                closed                                                                                                                                                               |   |               | (22    | )                  |   | (19            | )      |      | (14    | ) |   | (55 | ) |
|  Net                changes in stores                                                                                                                                                 |   |               | (3     | )                  |   | 26             |   |      | (8     | ) |   | 15 |   |
|                                                                                                                                                                                       |   |               |   |               |   |           |   |      |   |   |   |   |   |
| Stores                at January 28, 2006                                                                                                                                                  |   |               | 1,025  |               |   | 748            |   |      | 463    |   |   | 2,236 |   |
|                                                                                                                                                                                       |   |               |   |               |   |           |   |      |   |   |   |   |   |
| Stores                relocated during period                                                                                                                                              |   |               | 20     |               |   | 30             |   |      | 16     |   |   | 66 |   |
|                                                                                                                                                                                       |   |               |   |               |   |           |   |      |   |   |   |   |   |
| **Fiscal                2007:**                                                                                                                                                            |   |               |   |               |   |           |   |      |   |   |   |   |   |
| Planned                store openings                                                                                                                                                      |   |               | 15     |               |   | 135-140        | (2)    |      | 8      |   |   | 158-163 |   |
| Planned                store closings                                                                                                                                                      |   |               | 20     |               |   | 15             |   |      | 8      |   |   | 43 |   |
| Planned                store relocations                                                                                                                                                   |   |               | 35     |               |   | 35             |   |      | 15     |   |   | 85 |   |
| ____________________                                                                                                                                                                       |   |               |   |               |   |           |   |      |   |   |   |   |   |
| (1) Does                not include 3 outlet stores operated by Crosstown Traders,                Inc.                                                                                |
| (2) Includes                75-80 LANE BRYANT OUTLET                stores under leases assumed from Retail Brand Alliance under an agreement                effective April 1, 2006. |

**Comparison      of Fiscal 2006 to Fiscal 2005**

***Net      Sales***

**“RECENT      DEVELOPMENTS”**

----

Table            of Contents

***Cost      of Goods Sold, Buying, Catalog, and Occupancy***

----

Table            of Contents

***Selling,      General, and Administrative***

**“RECENT      DEVELOPMENTS: **
***VISA/      MasterCard Antitrust Litigation”***
**“Comparison      of Fiscal 2005 to Fiscal 2004; **
***Selling,      General, and Administrative”***

***Other      Income***

----

Table            of Contents

***Income      Tax Provision***

**“Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES;**
***Income      Taxes***
**”**

**Comparison      of Fiscal 2005 to Fiscal 2004**

***Net      Sales***

----

Table            of Contents

***Cost      of Goods Sold, Buying, Catalog, and Occupancy***

***Selling,      General, and Administrative***

***Expenses      Related to Cost Reduction Plan***

----

Table            of Contents

***Income      Tax Provision***

**“Comparison      of Fiscal 2006 to Fiscal 2005; **
***Income      Tax Provision”***

**Comparison      of Fourth Quarter 200**
**6      to Fourth Quarter 2005**

***Net      Sales***

**“RECENT      DEVELOPMENTS”**

----

Table            of Contents

***Cost      of Goods Sold, Buying, Catalog, and Occupancy***

***Selling,      General, and Administrative***

----

Table            of Contents

***Income      Tax Provision***

**FINANCIAL      CONDITION**

**Liquidity      and Capital Resources**

|                                                                |   | **Fiscal** |    | **Fiscal** |   | **Fiscal** |   |
|---------------------------------------------------------------------|--------|------------|---------|------------|--------|------------|--------|
| **(Dollars                in thousands)**                           |   | **2006**   |    | **2005**   |   | **2004**   |   |
|                                                                |   |       |    |       |   |       |   |   |   |   |
| Cash                and cash equivalents                            |   | $          | 130,132 |       | $      | 273,049    |   | $ | 123,781 |   |
| U.S.                Treasury bills and government agency securities |   |       | 19,781  |       |   | 0          |   |   | 14,281 |   |
| Cash                provided by operating activities                |   |       | 164,812 |       |   | 165,940    |   |   | 99,662 |   |
| Working                capital                                      |   |       | 338,641 |       |   | 413,989    |   |   | 266,178 |   |
| Current                ratio                                        |   |       | 1.8     |       |   | 2.4        |   |   | 1.9 |   |
| Long-term                debt to equity ratio                       |   |       | 23.6    | %          |   | 30.0       | %      |   | 34.5 | % |

***Cash      Provided by Operating Activities***

----

Table            of Contents

***Capital      Expenditures***

----

Table            of Contents

**“RESULTS      OF OPERATIONS; Comparison of Fiscal 2005 to Fiscal 2004;**
***Expenses Related to Cost Reduction Plan”***
* *
**“Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; NOTE 15. EXPENSES RELATED TO COST REDUCTION      PLAN”**

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Table            of Contents

***Long-term      Debt, Lease, Dividend, and Purchase Commitments***

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | **Payments                Due by Period** |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|---------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                      |    |   |   | **One                to** |   | **Three** |   | **More** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                      |    | **Less                Than** |   | **Three** |   | **to                Five** |   | **than                Five** |   |
| **(In                millions)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | **Total**                                 |    | **One                Year** |   | **Years** |   | **Years** |   | **Years** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term                debt, including current portion(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $                                         | 237.4   |   | $ | 11.9 |   | $ | 23.6 |   | $ | 23.1 |   | $ | 178.8 |   |
| Capital                leases                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                      | 26.8    |   |   | 13.2 |   |   | 13.2 |   |   | 0.4 |   |   | 0.0 |   |
| Operating                leases(2)                (3) (4)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                      | 859.9   |   |   | 216.7 |   |   | 315.4 |   |   | 190.6 |   |   | 137.2 |   |
| Revolving                credit facility(5)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                                      | 50.0    |   |   | 50.0 |   |   | 0.0 |   |   | 0.0 |   |   | 0.0 |   |
| Letters                of credit(5)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                      | 102.5   |   |   | 102.5 |   |   | 0.0 |   |   | 0.0 |   |   | 0.0 |   |
| Stand-by                letters of credit(5)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                      | 9.4     |   |   | 9.4 |   |   | 0.0 |   |   | 0.0 |   |   | 0.0 |   |
| Long-term                deferred compensation(6)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      | 2.6     |   |   | 1.2 |   |   | 0.8 |   |   | 0.4 |   |   | 0.2 |   |
| Purchase                commitments(3)                (7)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                      | 557.7   |   |   | 557.7 |   |   | 0.0 |   |   | 0.0 |   |   | 0.0 |   |
| Total                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                         | 1,846.3 |   | $ | 962.6 |   | $ | 353.0 |   | $ | 214.5 |   | $ | 316.2 |   |
| ____________________                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                      |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Amounts                represent the expected cash payments (including interest) of our                long-term                debt (including our convertible debt through maturity and excluding                capital leases) and do not include any fair value adjustments, bond                premiums, discounts or revolving credit facilities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (2) Commitments                under operating leases include $15.6 million payable under the LANE                BRYANT                master sublease with Limited Brands, which we have                guaranteed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| (3) Includes                amounts for Crosstown Traders, Inc., acquired June 2,                2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| (4) Includes                minimum annual rent commitments for outlet store leases assumed from                Retail Brand Alliance under an agreement effective April 1,                2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| (5)  We                currently have a $375 million revolving credit facility that expires                on                July 28, 2010, which provides for cash borrowings and the ability                to issue                up to $300 million of letters of credit. At January 28, 2006, there                were                $50.0 million of borrowings under this facility. Interest on the                borrowings is at a variable rate, determined monthly, and has been                excluded from this schedule.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| (6)                 Long                term compensation consists of our non-qualified deferred compensation                plan                and supplemental retirement plan, which are included in “Deferred taxes                and other non-current liabilities” on our consolidated balance sheets. We                have developed estimates of projected payment obligations for participant                planned in-service distributions of the deferred compensation plan                liability as of January 28, 2006. We have excluded $26.3 million                of                retirement/termination benefit distribution obligations as of January                28,                2006 from the above estimates. This amount has been excluded because                the                value of the obligation and the timing of payments may vary annually                due                to changes in the fair value of the plan assets and/or assumptions                for                participant retirement/termination. |
| (7)                 Purchase                commitments include agreements to purchase goods or services in the                ordinary course of business.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |

***Dividends***

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Table            of Contents

***Off-Balance-Sheet      Arrangements***

| **(Dollars                in millions)**                                                                                                                                                                                                                                                                                                                                                                                        | **Series                1999-2** | **Series                2002-1** | **Series                2004**   | **Series                2004-1** | **2005-RPA**(1)                  |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                            |                             |                             |                             |                             |                             |
| Date                of facility                                                                                                                                                                                                                                                                                                                                                                                                 | May                1999          | November                2002     | January                2004      | August                2004       | May                2005          |
| Type                of facility                                                                                                                                                                                                                                                                                                                                                                                                 | Conduit                          | Term                             | Conduit                          | Term                             | Conduit                          |
| Maximum                funding                                                                                                                                                                                                                                                                                                                                                                                                  | $50.0                            | $100.0                           | $50.0                            | $180.0                           | $55.0                            |
| Funding                as of January 28, 2006                                                                                                                                                                                                                                                                                                                                                                                   | $24.8                            | $100.0                           | $0.0                             | $180.0                           | $48.0                            |
| First                scheduled principal payment                                                                                                                                                                                                                                                                                                                                                                                | Not                applicable    | August                2007       | Not                applicable    | April                2009        | Not                applicable    |
| Expected                final principal payment                                                                                                                                                                                                                                                                                                                                                                                 | Not                applicable(2) | May                2008          | Not                applicable(2) | March                2010        | Not                applicable(2) |
| Renewal                                                                                                                                                                                                                                                                                                                                                                                                                         | Annual                           | Not                applicable    | Annual                           | Not                applicable    | Annual                           |
| ____________________                                                                                                                                                                                                                                                                                                                                                                                                            |                             |                             |                             |                             |                             |
| (1) Receivables                Purchase Agreement.                                                                                                                                                                                                                                                                                                                                                                         |
| (2) Series                1999-2 and Series 2004 have scheduled final payment dates that occur                in                the twelfth month following the month in which the series begins                amortizing. These series and 2005-RPA generally begin amortizing                364 days                after start of the purchase commitment by the series purchaser currently                in effect. |

** **

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Table            of Contents

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Table            of Contents

**“CRITICAL      ACCOUNTING POLICIES; **
***Asset      Securitizations***
**”**
* *
**“MARKET      RISK”**
**“Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; **
**NOTE      17. ASSET SECURITIZATION**
**”**

**“Liquidity      and Capital Resources”**
**“Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; **
**NOTE      18. LEASES**
**”**

***Revolving      Credit Facility***

----

Table            of Contents

***Long-term      Debt and Equity Financing***

----

Table            of Contents

**MARKET      RISK**

***“***
***Off-Balance-Sheet      Financing***
***”***

**IMPACT      OF RECENT ACCOUNTING PRONOUNCEMENTS**

**“Item      8. Financial Statements and Supplementary Data; Notes to Consolidated Financial      Statements; **
**NOTE      1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
**;      **
***Impact      of Recent Accounting Pronouncements***
*.*
**”**

**Item      7A. Quantitative and Qualitative Disclosures About Market      Risk**

**“Item      7. Management’s Discussion and Analysis of Financial Condition and Results of      Operations - **
**MARKET      RISK**
**”**

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Table            of Contents

**Item      8. Financial Statements and Supplementary Data**

**MANAGEMENT’S****REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING**

*“Internal      Control - Integrated Framework*
*”*

**-**

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Table            of Contents

**REPORT****OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON      INTERNAL**

**CONTROL      OVER FINANCIAL REPORTING**

*“Internal      Control - Integrated Framework”*

----

Table            of Contents

**/S/      ERNST & YOUNG LLP**

----

Table            of Contents

**REPORT****OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

*“Internal      Control - Integrated Framework”*

**/S/      ERNST & YOUNG LLP**

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Table            of Contents

**CHARMING      SHOPPES****,      INC. AND SUBSIDIARIES**

**CONSOLIDATED      BALANCE SHEETS**

|                                                                                |   | **January                28,** |      | **January                29,** |   |
|-------------------------------------------------------------------------------------|--------|--------------------------------|-----------|--------------------------------|--------|
| **(Dollars                in thousands, except share amounts)**                     |   | **2006**                       |      | **2005**                       |   |
|                                                                                |   |                           |      |                           |   |   |   |
| **ASSETS**                                                                          |   |                           |      |                           |   |   |   |
| **Current                assets**                                                   |   |                           |      |                           |   |   |   |
| Cash                and cash equivalents                                       |   | $                              | 130,132   |                           | $      | 273,049 |   |
| Available-for-sale                securities                                   |   |                           | 86,978    |                           |   | 52,857 |   |
| Accounts                receivable, net of allowances of $6,588 in 2006        |   |                           | 38,603    |                           |   | 0 |   |
| Merchandise                inventories                                         |   |                           | 376,409   |                           |   | 285,120 |   |
| Deferred                advertising                                            |   |                           | 20,591    |                           |   | 0 |   |
| Deferred                taxes                                                  |   |                           | 13,848    |                           |   | 15,500 |   |
| Prepayments                and other                                           |   |                           | 89,245    |                           |   | 86,382 |   |
| **Total                current assets**                                             |   |                           | 755,806   |                           |   | 712,908 |   |
|                                                                                |   |                           |      |                           |   |   |   |
| Property,                equipment, and leasehold improvements - at cost       |   |                           | 888,481   |                           |   | 786,028 |   |
| Less                accumulated depreciation and amortization                  |   |                           | 525,882   |                           |   | 465,365 |   |
| **Net                property, equipment, and leasehold improvements**              |   |                           | 362,599   |                           |   | 320,663 |   |
|                                                                                |   |                           |      |                           |   |   |   |
| Trademarks                and other intangible assets                          |   |                           | 250,074   |                           |   | 169,818 |   |
| Goodwill                                                                       |   |                           | 154,553   |                           |   | 66,666 |   |
| Available-for-sale                securities                                   |   |                           | 240       |                           |   | 240 |   |
| Other                assets                                                    |   |                           | 43,723    |                           |   | 33,476 |   |
| **Total                assets**                                                |   | $                              | 1,566,995 |                           | $      | 1,303,771 |   |
|                                                                                |   |                           |      |                           |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS’ EQUITY**                       |   |                           |      |                           |   |   |   |
| **Current                liabilities**                                              |   |                           |      |                           |   |   |   |
| Short-term                borrowings                                           |   | $                              | 50,000    |                           | $      | 0 |   |
| Accounts                payable                                                |   |                           | 133,236   |                           |   | 127,819 |   |
| Accrued                expenses                                                |   |                           | 217,421   |                           |   | 154,681 |   |
| Income                taxes payable                                            |   |                           | 1,743     |                           |   | 0 |   |
| Current                portion - long-term debt                                |   |                           | 14,765    |                           |   | 16,419 |   |
| **Total                current liabilities**                                        |   |                           | 417,165   |                           |   | 298,919 |   |
|                                                                                |   |                           |      |                           |   |   |   |
| Deferred                taxes                                                  |   |                           | 45,046    |                           |   | 31,645 |   |
| Other                non-current liabilities                                   |   |                           | 98,457    |                           |   | 70,098 |   |
| Long-term                debt                                                  |   |                           | 191,979   |                           |   | 208,645 |   |
|                                                                                |   |                           |      |                           |   |   |   |
| **Stockholders’                equity**                                       |   |                           |      |                           |   |   |   |
| Common                stock $.10 par value                                          |   |                           |      |                           |   |   |   |
| Authorized                - 300,000,000 shares                                      |   |                           |      |                           |   |   |   |
| Issued                - 133,954,852 shares and 132,063,290 shares                   |   |                           | 13,395    |                           |   | 13,206 |   |
| Additional                paid-in capital                                      |   |                           | 274,530   |                           |   | 249,485 |   |
| Treasury                stock at cost - 12,265,993 shares                      |   |                           | (84,136   | )                              |   | (84,136 | ) |
| Deferred                employee compensation                                  |   |                           | (13,453   | )                              |   | (8,715 | ) |
| Accumulated                other comprehensive loss                            |   |                           | (3        | )                              |   | 0 |   |
| Retained                earnings                                               |   |                           | 624,015   |                           |   | 524,624 |   |
| **Total                stockholders’ equity**                                 |   |                           | 814,348   |                           |   | 694,464 |   |
| **Total                liabilities and stockholders’ equity**            |   | $                              | 1,566,995 |                           | $      | 1,303,771 |   |
|                                                                                |   |                           |      |                           |   |   |   |
| ***See                Notes to Consolidated Financial                Statements.*** |

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Table            of Contents

**CHARMING      SHOPPES,****INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

**AND      COMPREHENSIVE INCOME**

|                                                                                                                         |   | **Year                Ended**  |      |
|------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|-----------|
|                                                                                                                         |   | **January                28,** |      | **January                29,** |   | **January                31,** |   |
| **(In                thousands, except per share amounts)**                                                                  |   | **2006**                       |      | **2005** |   | **2004** |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Net                sales**                                                                                            |   | $                              | 2,755,725 |   | $ | 2,334,736 |   | $ | 2,288,363 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| Cost                of goods sold, buying, catalog, and occupancy expenses                                              |   |                           | 1,911,275 |   |   | 1,642,650 |   |   | 1,645,499 |   |
| Selling,                general, and administrative expenses                                                            |   |                           | 683,231   |   |   | 577,301 |   |   | 558,248 |   |
| Expenses                related to cost reduction plan                                                                  |   |                           | 0         |   |   | 605 |   |   | 11,534 |   |
| **Total                operating expenses**                                                                             |   |                           | 2,594,506 |   |   | 2,220,556 |   |   | 2,215,281 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Income                from operations**                                                                               |   |                           | 161,219   |   |   | 114,180 |   |   | 73,082 |   |
| Other                income                                                                                             |   |                           | 9,093     |   |   | 3,098 |   |   | 2,050 |   |
| Interest                expense                                                                                         |   |                           | (17,911   | ) |   | (15,610 | ) |   | (15,609 | ) |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| Income                before income taxes and minority interest                                                         |   |                           | 152,401   |   |   | 101,668 |   |   | 59,523 |   |
| Income                tax provision                                                                                     |   |                           | 53,010    |   |   | 37,142 |   |   | 21,623 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| Income                before minority interest                                                                          |   |                           | 99,391    |   |   | 64,526 |   |   | 37,900 |   |
| Minority                interest in net loss of consolidated subsidiary                                                 |   |                           | 0         |   |   | 0 |   |   | 142 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Net                income**                                                                                           |   |                           | 99,391    |   |   | 64,526 |   |   | 38,042 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Other                comprehensive income/(loss), net of tax:**                                                            |   |                           |      |   |   |   |   |   |   |   |
| Unrealized                gains/(losses) on available-for-sale securities, net of income                tax                  |   |                           |      |   |   |   |   |   |   |   |
| (provision)/benefit                of $3 in 2006, $(92) in 2005, and $100 in 2004                                            |   |                           | (3        | ) |   | 113 |   |   | (156 | ) |
| Reclassification                of realized losses on available-for-sale securities                                          |   |                           |      |   |   |   |   |   |   |   |
| included                in net income, net of income tax benefit of $61 in 2005                                              |   |                           | 0         |   |   | 124 |   |   | 0 |   |
| Reclassification                of amortization of deferred loss on termination of                derivative,                |   |                           |      |   |   |   |   |   |   |   |
| net                of income tax benefit of $68 in 2005 and $184 in 2004                                                     |   |                           | 0         |   |   | 128 |   |   | 341 |   |
| Total                other comprehensive income/(loss)                                                                  |   |                           | (3        | ) |   | 365 |   |   | 185 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Comprehensive                income**                                                                                 |   | $                              | 99,388    |   | $ | 64,891 |   | $ | 38,227 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Basic                net income per share**                                                                           |   | $                              | .83       |   | $ | .56 |   | $ | .34 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| **Diluted                net income per share**                                                                         |   | $                              | .76       |   | $ | .52 |   | $ | .33 |   |
|                                                                                                                         |   |                           |      |   |   |   |   |   |   |   |
| Certain                prior-year amounts have been reclassified to conform to the current-year                presentation. |
| ***See                Notes to Consolidated Financial                Statements.***                                          |

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Table            of Contents

**CHARMING      SHOPPES****,      INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF STOCKHOLDERS**
**’      EQUITY**

|                                                       |   |                            |        |        |   | **Additional**                    |   |       |    |       |   |
|------------------------------------------------------------|--------|---------------------------------|-------------|-------------|--------|-----------------------------------|--------|------------|---------|------------|--------|
|                                                       |   | **Common                Stock** |        | **Paid-in** |   | **Treasury                Stock** |   |
| **(Dollars                in thousands)**                  |   | **Shares**                      |        | **Amount**  |   | **Capital**                       |   | **Shares** |    | **Amount** |   |
|                                                       |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| **Balance,                February 1, 2003**          |   |                            | 125,149,242 |        | $      | 12,515                            |   | $          | 200,040 |       |   | (12,265,993 | ) | $ | (84,136 | ) |
| Issued                to employees                    |   |                            | 179,506     |        |   | 18                                |   |       | 991     |       |   |   |   |   |   |   |
| Exercise                of stock options              |   |                            | 220,459     |        |   | 22                                |   |       | 834     |       |   |   |   |   |   |   |
| Shares                withheld for payment of employee     |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| payroll                taxes due on shares issued          |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| under                employee stock plans                  |   |                            | (22,634     | )           |   | (2                                | )      |       | (90     | )          |   |   |   |   |   |   |
| Tax                benefit - employee stock programs  |   |                            | 0           |        |   | 0                                 |   |       | 23      |       |   | 0 |   |   | 0 |   |
| **Balance,                January 31, 2004**          |   |                            | 125,526,573 |        |   | 12,553                            |   |       | 201,798 |       |   | (12,265,993 | ) |   | (84,136 | ) |
| Issued                to employees                    |   |                            | 411,411     |        |   | 41                                |   |       | 9,095   |       |   |   |   |   |   |   |
| Exercise                of stock options              |   |                            | 6,249,634   |        |   | 625                               |   |       | 33,062  |       |   |   |   |   |   |   |
| Shares                withheld for payment of employee     |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| payroll                taxes due on shares issued          |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| under                employee stock plans                  |   |                            | (15,082     | )           |   | (2                                | )      |       | (92     | )          |   |   |   |   |   |   |
| Shares                received in payment of stock         |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| option                exercises                            |   |                            | (109,246    | )           |   | (11                               | )      |       | (847    | )          |   |   |   |   |   |   |
| Tax                benefit - employee stock programs  |   |                            |  0     |        |   | 0                                 |   |       | 6,469   |       |   | 0 |   |   | 0 |   |
| **Balance,                January 29, 2005**          |   |                            | 132,063,290 |        |   | 13,206                            |   |       | 249,485 |       |   | (12,265,993 | ) |   | (84,136 | ) |
| Issued                to employees                    |   |                            | 51,909      |        |   | 5                                 |   |       | 12,260  |       |   |   |   |   |   |   |
| Exercise                of stock options              |   |                            | 1,865,554   |        |   | 187                               |   |       | 9,384   |       |   |   |   |   |   |   |
| Shares                withheld for payment of employee     |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| payroll                taxes due on shares issued          |   |                            |        |        |   |                              |   |       |    |       |   |   |   |   |   |   |
| under                employee stock plans                  |   |                            | (25,901     | )           |   | (3                                | )      |       | (216    | )          |   |   |   |   |   |   |
| Tax                benefit - employee stock programs  |   |                            | 0           |        |   | 0                                 |   |       | 3,617   |       |   | 0 |   |   | 0 |   |
| **Balance,                January 28, 2006**          |   |                            | 133,954,852 |        | $      | 13,395                            |   | $          | 274,530 |       |   | (12,265,993 | ) | $ | (84,136 | ) |

|                                                                                |   |             |    | **Accumulated**                  |   |         |   |
|-------------------------------------------------------------------------------------|--------|------------------|---------|----------------------------------|--------|--------------|--------|
|                                                                                |   | **Deferred**     |    | **Other**                        |   |         |   |
|                                                                                |   | **Employee**     |    | **Comprehensive**                |   | **Retained** |   |
| **(In                thousands)**                                                   |   | **Compensation** |    | **Income                (Loss)** |   | **Earnings** |   |
|                                                                                |   |             |    |                             |   |         |   |   |   |   |
| **Balance,                February 1, 2003**                                        |   | $                | (3,370  | )                                | $      | (550         | )      | $ | 422,056 |   |
| Issued                to employees                                                  |   |             | (600    | )                                |   |         |   |   |   |   |
| Amortization.                                                                       |   |             | 1,431   |                             |   |         |   |   |   |   |
| Unrealized                gains, net of income taxes of $84                         |   |             |    |                             |   | 185          |   |   |   |   |
| Net                income                                                           |   |             | 0       |                             |   | 0            |   |   | 38,042 |   |
| **Balance,                January 31, 2004**                                        |   |             | (2,539  | )                                |   | (365         | )      |   | 460,098 |   |
| Issued                to employees                                                  |   |             | (8,713  | )                                |   |         |   |   |   |   |
| Amortization.                                                                       |   |             | 2,537   |                             |   |         |   |   |   |   |
| Unrealized                gains, net of income taxes of $221                        |   |             |    |                             |   | 365          |   |   |   |   |
| Net                income                                                           |   |             | 0       |                             |   | 0            |   |   | 64,526 |   |
| **Balance,                January 29, 2005**                                        |   |             | (8,715  | )                                |   | 0            |   |   | 524,624 |   |
| Issued                to employees                                                  |   |             | (11,552 | )                                |   |         |   |   |   |   |
| Amortization.                                                                       |   |             | 6,814   |                             |   |         |   |   |   |   |
| Unrealized                gains, net of income taxes of $3                          |   |             |    |                             |   | (3           | )      |   |   |   |
| Net                income                                                           |   |             | 0       |                             |   | 0            |   |   | 99,391 |   |
| **Balance,                January 28, 2006**                                        |   | $                | (13,453 | )                                | $      | (3           | )      | $ | 624,015 |   |
|                                                                                |   |             |    |                             |   |         |   |   |   |   |
| ***See                Notes to Consolidated Financial                Statements.*** |

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Table            of Contents

**CHARMING      SHOPPES****,      INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF CASH FLOWS**

|                                                                                                                         |   | **Year                Ended**  |     |
|------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|----------|
|                                                                                                                         |   | **January                28,** |     | **January                29,** |   | **January                31,** |   |
| **(In                thousands)**                                                                                            |   | **2006**                       |     | **2005** |   | **2004** |   |
|                                                                                                                         |   |                           |     |   |   |   |   |   |   |   |
| **Operating                activities**                                                                                      |   |                           |     |   |   |   |   |   |   |   |
| Net                income                                                                                               |   | $                              | 99,391   |   | $ | 64,526 |   | $ | 38,042 |   |
| Adjustments                to reconcile net income to net                                                                    |   |                           |     |   |   |   |   |   |   |   |
| cash                provided by operating activities:                                                                        |   |                           |     |   |   |   |   |   |   |   |
| Depreciation                and amortization                                                                            |   |                           | 91,111   |   |   | 79,606 |   |   | 84,534 |   |
| Deferred                income taxes                                                                                    |   |                           | (10,139  | ) |   | 11,521 |   |   | 6,067 |   |
| Net                (gain)/loss from disposition of capital assets                                                       |   |                           | (725     | ) |   | 736 |   |   | 1,537 |   |
| Net                (gain)/loss from securitization activities                                                           |   |                           | (3,105   | ) |   | (1,182 | ) |   | 362 |   |
| Tax                benefit related to stock plans                                                                       |   |                           | 3,617    |   |   | 6,469 |   |   | 23 |   |
| Other,                net                                                                                               |   |                           | 0        |   |   | 185 |   |   | (142 | ) |
| Changes                in operating assets and liabilities:                                                                  |   |                           |     |   |   |   |   |   |   |   |
| Accounts                receivable                                                                                           |   |                           | (31,315  | ) |   | 0 |   |   | 0 |   |
| Merchandise                inventories                                                                                       |   |                           | (20,051  | ) |   | 24,875 |   |   | (23,523 | ) |
| Accounts                payable                                                                                              |   |                           | (6,952   | ) |   | (7,958 | ) |   | (12,175 | ) |
| Deferred                advertising                                                                                          |   |                           | (7,797   | ) |   | 0 |   |   | 0 |   |
| Prepayments                and other                                                                                         |   |                           | 5,636    |   |   | (28,888 | ) |   | 16,802 |   |
| Income                taxes payable                                                                                          |   |                           | 1,743    |   |   | (1,128 | ) |   | (6,016 | ) |
| Accrued                expenses and other                                                                                    |   |                           | 43,398   |   |   | 17,178 |   |   | (5,849 | ) |
| **Net                cash provided by operating activities**                                                            |   |                           | 164,812  |   |   | 165,940 |   |   | 99,662 |   |
|                                                                                                                         |   |                           |     |   |   |   |   |   |   |   |
| **Investing                activities**                                                                                      |   |                           |     |   |   |   |   |   |   |   |
| Investment                in capital assets                                                                             |   |                           | (103,835 | ) |   | (60,565 | ) |   | (54,028 | ) |
| Proceeds                from sales of capital assets                                                                    |   |                           | 3,432    |   |   | 0 |   |   | 500 |   |
| Gross                purchases of available-for-sale securities                                                         |   |                           | (50,630  | ) |   | (29,705 | ) |   | (35,802 | ) |
| Proceeds                from sales of available-for-sale securities                                                     |   |                           | 18,849   |   |   | 48,206 |   |   | 31,463 |   |
| Acquisition                of Crosstown Traders, Inc., net of cash acquired                                             |   |                           | (256,717 | ) |   | 0 |   |   | 0 |   |
| Purchase                of Catherines receivables portfolio                                                             |   |                           | (56,582  | ) |   | 0 |   |   | 0 |   |
| Securitization                of Catherines receivables portfolio                                                       |   |                           | 56,582   |   |   | 0 |   |   | 0 |   |
| Securitization                of Crosstown Traders, Inc. apparel-related receivables                                    |   |                           | 50,000   |   |   | 0 |   |   | 0 |   |
| Increase                in other assets                                                                                 |   |                           | (5,264   | ) |   | (6,984 | ) |   | (6,704 | ) |
| **Net                cash used by investing activities**                                                                |   |                           | (344,165 | ) |   | (49,048 | ) |   | (64,571 | ) |
|                                                                                                                         |   |                           |     |   |   |   |   |   |   |   |
| **Financing                activities**                                                                                      |   |                           |     |   |   |   |   |   |   |   |
| Proceeds                from short-term borrowings                                                                      |   |                           | 382,573  |   |   | 186,173 |   |   | 221,423 |   |
| Repayments                of short-term borrowings                                                                      |   |                           | (332,573 | ) |   | (186,173 | ) |   | (221,423 | ) |
| Proceeds                from long-term borrowings                                                                       |   |                           | 0        |   |   | 18,098 |   |   | 1,557 |   |
| Repayments                of long-term borrowings                                                                       |   |                           | (22,212  | ) |   | (18,530 | ) |   | (14,566 | ) |
| Payments                of deferred financing costs                                                                     |   |                           | (1,417   | ) |   | (350 | ) |   | (1,500 | ) |
| Proceeds                from issuance of common stock                                                                   |   |                           | 10,065   |   |   | 33,158 |   |   | 1,173 |   |
| **Net                cash provided/(used) by financing activities**                                                     |   |                           | 36,436   |   |   | 32,376 |   |   | (13,336 | ) |
|                                                                                                                         |   |                           |     |   |   |   |   |   |   |   |
| **Increase/(decrease)                in cash and cash equivalents**                                                     |   |                           | (142,917 | ) |   | 149,268 |   |   | 21,755 |   |
| **Cash                and cash equivalents, beginning of year**                                                         |   |                           | 273,049  |   |   | 123,781 |   |   | 102,026 |   |
| **Cash                and cash equivalents, end of year**                                                               |   | $                              | 130,132  |   | $ | 273,049 |   | $ | 123,781 |   |
|                                                                                                                         |   |                           |     |   |   |   |   |   |   |   |
| **Non-cash                financing and investing activities**                                                               |   |                           |     |   |   |   |   |   |   |   |
| Equipment                acquired through capital leases                                                                |   | $                              | 3,892    |   | $ | 5,399 |   | $ | 17,466 |   |
|                                                                                                                         |   |                           |     |   |   |   |   |   |   |   |
| Certain                prior-year amounts have been reclassified to conform to the current-year                presentation. |
| ***See                Notes to Consolidated Financial                Statements.***                                          |

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**CHARMING      SHOPPES****,      INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**NOTE      1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

***Business***

**“NOTE      2. ACQUISITION OF **
**CROSSTOWN      TRADERS**
**,      INC.”**

***Principles      of Consolidation***

**-      **

***Segment      Reporting***

**,      **
**“**
**NOTE      19. SEGMENT REPORTING**
**”**

***Foreign      Operations***

***Use      of Estimates***

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Reclassifications***

***Cash      Equivalents***

***Available-for-Sale      Securities***

**“**
**NOTE      17. ASSET SECURITIZATION**
**”**

***Accounts      Receivable***

***Inventories***

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Deferred      and Non-Deferred Advertising Costs***

*“Reporting      on Advertising Costs,” *

***Property      and Depreciation***

**“**
***Operating      Leases”***

*Accounting      for the Impairment or Disposal of Long-Lived Assets.*

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Lease      Accounting***

*Accounting      for Leases*

***Goodwill      and Other Intangible Assets***

*“Goodwill      and Other Intangible Assets.”*

**”**

**“**
**NOTE      19. SEGMENT REPORTING”**

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Asset      Securitization***

*“Accounting      for Transfers and Servicing of Financial Assets and Extinguishments of      Liabilities.”*

***Deferred      Debt Acquisition Costs***

***Insurance      Liabilities***

***Common      Stock Plans***

*Accounting      for Stock Issued to Employees*
*Accounting      for Stock-Based Compensation*
*Accounting      for Stock-Based Compensation - Transition and Disclosure.*

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

| **(In                thousands, except per share amounts)**             |   | **2006** |   | **2005** |   | **2004** |   |
|-------------------------------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                                                    |   |     |   |     |   |     |   |   |   |   |
| Net                income as reported                              |   | $        | 99,391 |     | $      | 64,526   |   | $ | 38,042 |   |
| Add                stock-based employee compensation as reported,       |   |     |   |     |   |     |   |   |   |   |
| using                intrinsic value method, net of income taxes        |   |     | 4,429  |     |   | 1,649    |   |   | 930 |   |
| Less                stock-based employee compensation, using fair-value |   |     |   |     |   |     |   |   |   |   |
| method,                net of income taxes                              |   |     | (5,307 | )        |   | (3,862   | )      |   | (3,298 | ) |
| Pro                forma net income                                |   | $        | 98,513 |     | $      | 62,313   |   | $ | 35,674 |   |
|                                                                    |   |     |   |     |   |     |   |   |   |   |
| Basic                net income per share:                              |   |     |   |     |   |     |   |   |   |   |
| As                reported                                              |   | $        | .83    |     | $      | .56      |   | $ | .34 |   |
| Pro                forma                                                |   |     | .82    |     |   | .54      |   |   | .32 |   |
| Diluted                net income per share:                            |   |     |   |     |   |     |   |   |   |   |
| As                reported                                              |   |     | .76    |     |   | .52      |   |   | .33 |   |
| Pro                forma                                                |   |     | .75    |     |   | .50      |   |   | .31 |   |

| **(In                percents)**                | **2006**                 | **2005**                 | **2004** |
|-------------------------------------------------|--------------------------|--------------------------|----------|
|                                            |                     |                     |     |
| Risk-free                interest rate:         |                     |                     |     |
| Employee                stock purchase plan     | 2.6                - 4.3 | 0.9                - 2.4 | 0.9      |
| Stock                award plans                | 3.5                - 4.5 | 1.9                - 3.9 | 2.8      |
| Stock                option and incentive plans | 4.2                - 4.5 | 2.8                - 4.4 | 2.8      |

*“Share-Based      Payment”*
*“Statement      of Cash Flows.”*
***“Impact      of Recent Accounting Pronouncements”***

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Revenue      Recognition***

**“**
**NOTE      13. CUSTOMER LOYALTY CARD PROGRAMS**
**”**

***Cost      of Goods Sold, Buying, Catalog, and Occupancy      Expenses***

**“**
***Revenue      Recognition”***
* *
***Deferred      Catalog Advertising Costs”***

***Costs      Associated With Exit or Disposal Activities***

*“Accounting      for Costs Associated with Exit or Disposal Activities.”*

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Income      Taxes***

*Accounting      for Income Taxes*

***Net      Income (Loss) Per Share***

***Comprehensive      Income***

***Business      Segments and Related Disclosures***

**“NOTE      2. ACQUISITION OF Crosstown Traders, INC.”**
**,      **
**“**
**NOTE      19. SEGMENT REPORTING**
**”**

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***Costs      of Computer Software Developed or Obtained for Internal      Use***

***Cash      Consideration Received from Vendors***

*Accounting      by a Customer (Including a Reseller) for Cash Consideration Received from a      Vendor.*

***Impact      of Recent Accounting Pronouncements***

*“Inventory      Costs - an Amendment of Accounting Research Bulletin No. 43, Chapter      4.”*

*“Share-Based      Payment”*
*“Statement      of Cash Flows.”*

*“Share-Based      Payment,”*
*“Amendment      to Rule 4-01(a) of Regulation S-X Regarding the Compliance Date for Financial      Accounting Standards No. 123 (revised 2004), Share-Based      Payment”*

*“Transition      Election Related to Accounting for the Tax Effects of Share-Based Payment      Awards.”*

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

***“Common      Stock Plans”***

*“Accounting      Changes and Error Corrections.” *
*“Accounting      Changes,”*
*“Reporting      Accounting Changes in Interim Financial Statements - an amendment of APB Opinion      No. 28.”*

*“Determining      the Amortization Period for Leasehold Improvements.”*

*“Accounting      for Rental Costs Incurred during a Construction Period.”*

**NOTE      2. ACQUISITION OF CROSSTOWN TRADERS, INC.**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**"Note      8. Short-term Borrowings and Long-term Debt"**

*“Business      Combinations,”*

*Goodwill      and Other Intangible Assets,*

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                                 |   | **Purchase**   |    |
|----------------------------------------------------------------------|--------|----------------|---------|
|                                                                 |   | **Price**      |    |
| **(In                thousands)**                                    |   | **Allocation** |    |
|                                                                 |   |           |    |   |
| Fair                value of assets acquired:                        |   |           |    |   |
| Cash                and cash equivalents                        |   | $              | 5,815   |   |
| Accounts                receivable                              |   |           | 60,092  |   |
| Merchandise                inventories                          |   |           | 71,238  |   |
| Deferred                advertising                             |   |           | 12,794  |   |
| Property,                equipment, and leasehold improvements  |   |           | 19,321  |   |
| Prepayments                and other                            |   |           | 8,319   |   |
| Fair                value of liabilities assumed:                    |   |           |    |   |
| Accounts                payable and accrued expenses            |   |           | (57,802 | ) |
| Other                liabilities                                |   |           | (2,366  | ) |
| Intangible                assets subject to amortization        |   |           | 13,100  |   |
| Intangible                assets not subject to amortization    |   |           | 70,000  |   |
| Deferred                tax effect of acquisition               |   |           | (25,866 | ) |
| Goodwill                                                        |   |           | 87,887  |   |
| Total                purchase price                             |   | $              | 262,532 |   |

*“Recognition      of Liabilities in Connection with a Purchase Business      Combination.”*

|                                                     |   |                          |   | **Fiscal                2006** |   | **Balance                at**  |   |
|----------------------------------------------------------|--------|-------------------------------|--------|--------------------------------|--------|--------------------------------|--------|
|                                                     |   | **Exit                Costs** |   | **Payments/**                  |   | **January                28,** |   |
| **(In                thousands)**                        |   | **Recorded**                  |   | **Settlements**                |   | **2006**                       |   |
|                                                     |   |                          |   |                           |   |                           |   |   |   |   |
| Severance                and related costs          |   | $                             | 4,743  |                           | $      | (363                           | )      | $ | 4,380 |   |
| Lease                termination and related costs  |   |                          | 2,180  |                           |   | 0                              |   |   | 2,180 |   |
| Unfavorable                contract costs           |   |                          | 900    |                           |   | 0                              |   |   | 900 |   |
| Other                costs                          |   |                          | 1,154  |                           |   | 0                              |   |   | 1,154 |   |
| Total                                               |   | $                             | 8,977  |                           | $      | (363                           | )      | $ | 8,614 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                        |   |                           |      |
|-------------------------------------------------------------|--------|--------------------------------|-----------|
|                                                        |   | **Year                Ended**  |      |
|                                                        |   | **January                28,** |      | **January                29,** |   |
| **(In                thousands, except per share amounts)** |   | **2006**                       |      | **2005** |   |
|                                                        |   |                           |      |   |   |   |   |
| Net                sales                               |   | $                              | 2,897,904 |   | $ | 2,793,663 |   |
| Net                income                              |   |                           | 98,317    |   |   | 75,197 |   |
|                                                        |   |                           |      |   |   |   |   |
| Net                income per share:                        |   |                           |      |   |   |   |   |
| Basic                                                       |   | $                              | .82       |   | $ | .65 |   |
| Diluted                                                     |   |                           | .75       |   |   | .60 |   |
|                                                        |   |                           |      |   |   |   |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      3. ACCOUNTS RECEIVABLE**

|                                                 |   | **January                28,** |   |
|------------------------------------------------------|--------|--------------------------------|--------|
| **(In                thousands)**                    |   | **2006**                       |   |
|                                                 |   |                           |   |   |
| Due                from customers               |   | $                              | 45,191 |   |
| Allowance                for doubtful accounts  |   |                           | (6,588 | ) |
| Net                accounts receivable          |   | $                              | 38,603 |   |

|                                                                  |   | **Year                Ended**  |   |
|-----------------------------------------------------------------------|--------|--------------------------------|--------|
|                                                                  |   | **January                28,** |   |
|                                                                  |   | **2006**                       |   |
|                                                                  |   |                           |   |   |
| Balance                as of June 2, 2005 (date of acquisition)  |   | $                              | 0      |   |
| Provision                for doubtful accounts                   |   |                           | (5,661 | ) |
| Collections                of accounts previously written off    |   |                           | (1,030 | ) |
| Accounts                written off                              |   |                           | 103    |   |
| Balance,                January 28, 2006                         |   | $                              | (6,588 | ) |

**NOTE      4. PROPERTY, EQUIPMENT, AND LEASEHOLD IMPROVEMENTS**

|                                                                      |   | **Lives**   |                    |     |   |     |   |
|---------------------------------------------------------------------------|--------|-------------|-------------------------|----------|--------|----------|--------|
| **(Dollars                in thousands)**                                 |   | **(Years)** |                    | **2006** |   | **2005** |   |
|                                                                      |   |        |                    |     |   |     |   |   |   |   |
| Land                                                                 |   |        |                    |     | $      | 5,829    |   | $ | 5,983 |   |
| Buildings                and improvements                            |   |        | 10                to 40 |     |   | 74,573   |   |   | 70,549 |   |
| Store                fixtures                                        |   |        | 5                to 10  |     |   | 145,586  |   |   | 128,958 |   |
| Equipment                                                            |   |        | 3                to 10  |     |   | 208,266  |   |   | 179,358 |   |
| Equipment                acquired under capital leases               |   |        | 7                       |     |   | 71,908   |   |   | 68,119 |   |
| Leasehold                improvements                                |   |        | 10(1)                   |     |   | 382,319  |   |   | 333,061 |   |
| Total                at cost                                         |   |        |                    |     |   | 888,481  |   |   | 786,028 |   |
| Less: Accumulated                depreciation and amortization  |   |        |                    |     |   | 491,154  |   |   | 440,551 |   |
| Accumulated                amortization of capital lease assets           |   |        |                    |     |   | 34,728   |   |   | 24,814 |   |
| Total                accumulated depreciation and amortization       |   |        |                    |     |   | 525,882  |   |   | 465,365 |   |
| Net                property, equipment, and leasehold improvements   |   |        |                    |     | $      | 362,599  |   | $ | 320,663 |   |
| ____________________                                                      |   |        |                    |     |   |     |   |   |   |   |
| (1) Or                the life of the lease, if shorter.             |   |        |                    |     |   |     |   |   |   |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      5. TRADEMARKS AND OTHER INTANGIBLE ASSETS**

|                                                                                       |   | **Life**    |                  |     |   |     |   |
|--------------------------------------------------------------------------------------------|--------|-------------|-----------------------|----------|--------|----------|--------|
| **(Dollars                in thousands)**                                                  |   | **(Years)** |                  | **2006** |   | **2005** |   |
|                                                                                       |   |        |                  |     |   |     |   |   |   |   |
| Trademarks,                tradenames, and Internet domain names                      |   |        |                  |     | $      | 238,800  |   | $ | 168,800 |   |
| Customer                lists, customer relationships,                                     |   |        |                  |     |   |     |   |   |   |   |
| and                covenant not to compete                                            |   |        | 4                to 5 |     |   | 16,400   |   |   | 3,300 |   |
| Total                at cost                                                          |   |        |                  |     |   | 255,200  |   |   | 172,100 |   |
| Less: accumulated                amortization of customer lists,                      |   |        |                  |     |   |     |   |   |   |   |
|     customer                relationships, and covenant not to compete |   |        |                  |     |   | 5,126    |   |   | 2,282 |   |
| Net                trademarks and other intangible assets                             |   |        |                  |     | $      | 250,074  |   | $ | 169,818 |   |

**-      **
**-      **
**-      **

**NOTE      6. AVAILABLE-FOR-SALE SECURITIES**

|                                                                                                                                                                                                                                                                                                                                                                                                             |   |     |   | **Estimated**                 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|--------|-------------------------------|--------|
| **(In                thousands)**                                                                                                                                                                                                                                                                                                                                                                                |   | **Cost** |   | **Fair                Value** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                             |   |     |   |                          |   |   |   |
| **January                28, 2006**                                                                                                                                                                                                                                                                                                                                                                              |   |     |   |                          |   |   |   |
| U.S.                Treasury Bills                                                                                                                                                                                                                                                                                                                                                                          |   | $        | 19,781 |                          | $      | 19,781 |   |
| Charming                Shoppes Master Trust certificates and retained interests(1)                                                                                                                                                                                                                                                                                                                         |   |     | 66,828 |                          |   | 66,828 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                       |   |     | 609    |                          |   | 609 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                             |   | $        | 87,218 |                          | $      | 87,218 |   |
| **January                29, 2005**                                                                                                                                                                                                                                                                                                                                                                              |   |     |   |                          |   |   |   |
| Charming                Shoppes Master Trust certificates and retained interests(1)                                                                                                                                                                                                                                                                                                                         |   | $        | 52,485 |                          | $      | 52,485 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                       |   |     | 612    |                          |   | 612 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                             |   | $        | 53,097 |                          | $      | 53,097 |   |
| ____________________                                                                                                                                                                                                                                                                                                                                                                                             |   |     |   |                          |   |   |   |
| (1) Includes                Master Trust certificates of $10,690,000, Interest-only strip of                $15,061,000, and retained interests of $41,077,000 at January 28,                2006,                and Master Trust certificates of $17,325,000, Interest-only strip                of                $10,390,000, and retained interests of $24,770,000 at January 29,                2005. |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                                                                                                                    |   |     |   | **Estimated**                 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|--------|-------------------------------|--------|
| **(In                thousands)**                                                                                                                       |   | **Cost** |   | **Fair                Value** |   |
|                                                                                                                                                    |   |     |   |                          |   |   |   |
| Due                in one year or less(1)                                                                                                               |   | $        | 86,978 |                          | $      | 86,978 |   |
| Due                after ten years                                                                                                                      |   |     | 240    |                          |   | 240 |   |
|                                                                                                                                                    |   | $        | 87,218 |                          | $      | 87,218 |   |
| ____________________                                                                                                                                    |   |     |   |                          |   |   |   |
| (1) Includes                Charming Shoppes Master Trust certificates, interest-only strip,                and                retained interests. |

**NOTE      7. INCOME TAXES**

| **(In                thousands)** |   | **2006** |    | **2005** |   | **2004** |   |
|-----------------------------------|--------|----------|---------|----------|--------|----------|--------|
|                              |   |     |    |     |   |     |   |   |   |   |
| Domestic                          |   | $        | 144,753 |     | $      | 98,144   |   | $ | 56,181 |   |
| Foreign                           |   |     | 7,648   |     |   | 3,524    |   |   | 3,342 |   |
|                              |   | $        | 152,401 |     | $      | 101,668  |   | $ | 59,523 |   |

| **(In                thousands)** |   | **2006** |   | **2005** |   | **2004** |   |
|-----------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                              |   |     |   |     |   |     |   |   |   |   |
| **Current:**                      |   |     |   |     |   |     |   |   |   |   |
| Federal                           |   | $        | 50,097 |     | $      | 20,857   |   | $ | 14,973 |   |
| State                             |   |     | 4,255  |     |   | 6,275    |   |   | 1,913 |   |
| Foreign                           |   |     | 892    |     |   | 668      |   |   | 529 |   |
|                              |   |     | 55,244 |     |   | 27,800   |   |   | 17,415 |   |
| **Deferred**:                     |   |     |   |     |   |     |   |   |   |   |
| Federal                           |   |     | (547   | )        |   | 8,885    |   |   | 4,337 |   |
| State                             |   |     | (1,687 | )        |   | 457      |   |   | (129 | ) |
|                              |   |     | (2,234 | )        |   | 9,342    |   |   | 4,208 |   |
|                              |   | $        | 53,010 |     | $      | 37,142   |   | $ | 21,623 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                       |   | **2006** |   | **2005** |   | **2004** |   |
|------------------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                                       |   |     |   |     |   |     |   |   |   |   |
| Statutory                Federal income tax rate           |   |     | 35.0   | %        |   | 35.0     | %      |   | 35.0 | % |
| State                income tax, net of Federal income tax |   |     | 0.4    |     |   | 2.2      |   |   | 1.9 |   |
| Foreign                income                              |   |     | (1.2   | )        |   | (0.6     | )      |   | (1.1 | ) |
| Employee                benefits                           |   |     | (0.6   | )        |   | (1.0     | )      |   | (0.5 | ) |
| Other,                net                                  |   |     | 1.2    |     |   | 0.9      |   |   | 1.0 |   |
|                                                       |   |     | 34.8   | %        |   | 36.5     | %      |   | 36.3 | % |

|                                                           |   | **Net                Current** |   | **Net                Long-Term** |   |
|----------------------------------------------------------------|--------|--------------------------------|--------|----------------------------------|--------|
|                                                           |   | **Assets**                     |   | **Assets**                       |   |
| **(In                thousands)**                              |   | **(Liabilities)**              |   | **(Liabilities)**                |   |
|                                                           |   |                           |   |                             |   |   |   |
| **January                28, 2006**                            |   |                           |   |                             |   |   |   |
| Property,                equipment, and leasehold improvements |   |                           |   |                             | $      | (15,669 | ) |
| Accounts                receivable                             |   | $                              | 3,288  |                             |   |   |   |
| Prepaid                and accrued expenses                    |   |                           | 7,614  |                             |   |   |   |
| Inventory                                                      |   |                           | (472   | )                                |   |   |   |
| Deferred                compensation                           |   |                           | 4,355  |                             |   | 14,641 |   |
| Goodwill                and intangible assets                  |   |                           |   |                             |   | (57,163 | ) |
| Investments                                                    |   |                           |   |                             |   | (924 | ) |
| Deferred                rent                                   |   |                           |   |                             |   | 14,036 |   |
| Other                                                          |   |                           | (937   | )                                |   | 33 |   |
|                                                           |   | $                              | 13,848 |                             | $      | (45,046 | ) |
|                                                           |   |                           |   |                             |   |   |   |
| **January                29, 2005**                            |   |                           |   |                             |   |   |   |
| Property,                equipment, and leasehold improvements |   |                           |   |                             | $      | (19,374 | ) |
| Tax                net operating loss and credit carryforwards |   |                           |   |                             |   | 564 |   |
| Prepaid                and accrued expenses                    |   | $                              | 13,084 |                             |   |   |   |
| Inventory                                                      |   |                           | (1,902 | )                                |   |   |   |
| Deferred                compensation                           |   |                           |   |                             |   | 8,662 |   |
| Intangible                assets                               |   |                           |   |                             |   | (26,524 | ) |
| Investments                                                    |   |                           |   |                             |   | (1,878 | ) |
| Deferred                rent                                   |   |                           |   |                             |   | 6,867 |   |
| Other                                                          |   |                           | 4,318  |                             |   | 38 |   |
|                                                           |   | $                              | 15,500 |                             | $      | (31,645 | ) |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      8. SHORT-TERM BORROWINGS AND LONG-TERM DEBT**

| **(In                thousands)**                           |   | **2006** |    | **2005** |   |
|-------------------------------------------------------------|--------|----------|---------|----------|--------|
|                                                        |   |     |    |     |   |   |   |
| **Short-term                borrowings**                    |   |     |    |     |   |   |   |
| Revolving                credit facility                    |   | $        | 50,000  |     | $      | 0 |   |
|                                                        |   |     |    |     |   |   |   |
| **Long-term                debt**                           |   |     |    |     |   |   |   |
| 4.75%                Senior Convertible Notes due June 2012 |   | $        | 150,000 |     | $      | 150,000 |   |
| Capital                lease obligations                    |   |     | 24,825  |     |   | 34,825 |   |
| 6.07%                mortgage note, due October 2014        |   |     | 12,261  |     |   | 12,821 |   |
| 6.53%                mortgage note, due November 2012       |   |     | 9,450   |     |   | 10,850 |   |
| 7.77%                mortgage note due December 2011        |   |     | 9,050   |     |   | 9,564 |   |
| Variable                rate mortgage note due March 2006   |   |     | 0       |     |   | 5,605 |   |
| Other                long-term debt                         |   |     | 1,158   |     |   | 1,399 |   |
| Total                long-term debt                         |   |     | 206,744 |     |   | 225,064 |   |
| Less                current portion                         |   |     | 14,765  |     |   | 16,419 |   |
|                                                        |   | $        | 191,979 |     | $      | 208,645 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**“**
**NOTE      2. ACQUISITION OF CROSSTOWN TRADERS, INC.**
**”**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

| **(In                thousands)**        |   | **2007** |   | **2008** |   | **2009** |   | **2010** |   | **2011** |   |
|------------------------------------------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|
|                                     |   |     |   |     |   |     |   |     |   |     |   |   |   |   |   |   |
| Capital                lease obligations |   | $        | 11,972 |     | $      | 8,026    |   | $        | 4,425  |     | $      | 402 |   | $ | 0 |   |
| Mortgage                notes            |   |     | 2,549  |     |   | 2,631    |   |     | 2,718  |     |   | 2,813 |   |   | 2,913 |   |
| Other                long-term debt      |   |     | 244    |     |   | 247      |   |     | 250    |     |   | 252 |   |   | 120 |   |
|                                     |   | $        | 14,765 |     | $      | 10,904   |   | $        | 7,393  |     | $      | 3,467 |   | $ | 3,033 |   |

**-      **
**-      **
**-      **
**-      **
**-      **

**NOTE      9. STOCKHOLDERS’ EQUITY**

|   | · | 1,000,000                shares of Series Participating Preferred Stock, $1.00 par value,                of which                500,000 shares of Participating Series A Junior Preferred Stock,                $1.00 par                value, have been authorized; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | 300,000,000                shares of common stock, $.10 par                value. |
|--------|--------|-----------------------------------------------------------------------------------|

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      10. STOCK OPTION AND STOCK INCENTIVE PLANS**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                          |   | **2006** |                        | **2005** |   | **2004** |   |
|---------------------------------------------------------------|--------|----------|-----------------------------|----------|--------|----------|--------|
|                                                          |   |     |                        |     |   |     |   |   |   |   |
| One-time                restricted stock awards granted       |   |     | 10,000                      |     |   | 10,000   |   |   | 10,000 |   |
| Weighted                average market price at date of grant |   |     | $12.48                      |     |   | $7.65    |   |   | $4.57 |   |
| Shares                issued under stock awards               |   |     | 3,333                       |     |   | 13,333   |   |   | 3,334 |   |
| Restricted                awards outstanding at year-end      |   |     | 13,334                      |     |   | 6,667    |   |   | 10,000 |   |
| RSUs                granted                                   |   |     | 55,582                      |     |   | 24,658   |   |   | 21,000 |   |
| Weighted                average market price at date of grant |   |     |                  $9.29 |     |   | $8.42    |   |   | $4.78 |   |
| Shares                issued under RSUs                       |   |     | 25,834                      |     |   | 15,658   |   |   | 0 |   |
| RSUs                vested with issuance deferred             |   |     | 9,000                       |     |   | 6,000    |   |   | 0 |   |
| RSUs                outstanding at year-end                   |   |     | 44,748                      |     |   | 24,000   |   |   | 21,000 |   |
| Options                exercisable at year-end                |   |     | 455,225                     |     |   | 333,325  |   |   | 282,400 |   |

|                                                                                                 |   | **2006** |      | **2005** |   |
|------------------------------------------------------------------------------------------------------|--------|----------|-----------|----------|--------|
|                                                                                                 |   |     |      |     |   |   |   |
| Restricted                stock awards/RSUs granted                                                  |   |     | 1,092,915 |     |   | 270,900 |   |
| Weighted                average market price at date of grant for awards/RSUs                granted |   |     | $8.51     |     |   | $9.00 |   |
| Stock                awards/RSUs vested with issuance deferred                                       |   |     | 104,000   |     |   | 18,000 |   |
| Shares                issued under stock awards/RSUs                                                 |   |     | 5,769     |     |   | 0 |   |
| Cancellations                of restricted stock awards                                              |   |     | 37,500    |     |   | 0 |   |
| Restricted                awards outstanding at year-end                                             |   |     | 1,198,546 |     |   | 252,900 |   |
| Options                exercisable at year-end                                                       |   |     | 0         |     |   | 0 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                           |   | **2006** |      | **2005** |   | **2004**  |   |
|----------------------------------------------------------------|--------|----------|-----------|----------|--------|-----------|--------|
|                                                           |   |     |      |     |   |      |   |   |   |   |
| Restricted                stock awards granted            |   |     | 0         |     |   | 439,500   |   |   | 97,000 |   |
| Weighted                average market price at date of grant  |   |     |      |     |   |      |   |   |   |   |
| for                awards granted                              |   |     | -         |     |   | $7.31     |   |   | $3.36 |   |
| Shares                issued under stock awards           |   |     | 46,551    |     |   | 23,572    |   |   | 27,599 |   |
| Cancellations                of restricted stock awards   |   |     | 53,000    |     |   | 21,903    |   |   | 28,450 |   |
| Restricted                awards outstanding at year-end  |   |     | 524,265   |     |   | 623,816   |   |   | 229,791 |   |
| Options                exercisable at year-end            |   |     | 1,030,009 |     |   | 1,214,113 |   |   | 1,891,271 |   |

|                                                            |   | **2006** |      | **2005** |   | **2004**  |   |
|-----------------------------------------------------------------|--------|----------|-----------|----------|--------|-----------|--------|
|                                                            |   |     |      |     |   |      |   |   |   |   |
| Restricted                stock awards granted             |   |     | 0         |     |   | 393,000   |   |   | 52,500 |   |
| Weighted                average market price at date of grant   |   |     |      |     |   |      |   |   |   |   |
| for                awards granted                               |   |     | -         |     |   | $7.20     |   |   | $3.48 |   |
| Shares                issued under stock awards            |   |     | 42,810    |     |   | 67,760    |   |   | 88,060 |   |
| Stock                awards vested with issuance deferred  |   |     | 90,000    |     |   | 90,000    |   |   | 0 |   |
| Cancellations                of restricted stock awards    |   |     | 0         |     |   | 11,400    |   |   | 18,900 |   |
| Restricted                awards outstanding at year-end   |   |     | 597,310   |     |   | 730,120   |   |   | 506,280 |   |
| Options                exercisable at year-end             |   |     | 1,461,360 |     |   | 2,127,498 |   |   | 6,398,767 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                                 |   |       |       | **Average** |   |                             |   |
|----------------------------------------------------------------------|--------|------------|------------|-------------|--------|----------------------------------|--------|
|                                                                 |   | **Option** |       | **Option**  |   | **Option                Prices** |   |
|                                                                 |   | **Shares** |       | **Price**   |   | **Per                Share**     |   |
|                                                                 |   |       |       |        |   |                             |   |   |
| **Outstanding                at February 1, 2003**                   |   |       | 12,102,598 |        | $      | 6.028                            |   | $ | 1.000 |   | - |   | $ | 15.813 |   |
| Granted **-**option                price equal to market price  |   |       | 1,121,375  |        |   | 3.600                            |   |   | 2.760 |   | - |   |   | 6.640 |   |
| Granted **-**option                price less than market price |   |       | 44,300     |        |   | 1.000                            |   |   | 1.000 |   | - |   |   | 1.000 |   |
| Canceled/forfeited                                                   |   |       | (913,828   | )           |   | 8.517                            |   |   | 1.000 |   | - |   |   | 15.125 |   |
| Exercised                                                            |   |       | (220,459   | )           |   | 3.882                            |   |   | 1.000 |   | - |   |   | 6.000 |   |
| **Outstanding                at January 31, 2004**                   |   |       | 12,133,986 |        |   | 5.637                            |   |   | 1.000 |   | - |   |   | 12.125 |   |
| Granted **-**option                price equal to market price  |   |       | 101,925    |        |   | 7.573                            |   |   | 6.590 |   | - |   |   | 8.440 |   |
| Granted **-**option                price less than market price |   |       | 12,000     |        |   | 1.000                            |   |   | 1.000 |   | - |   |   | 1.000 |   |
| Canceled/forfeited                                                   |   |       | (493,811   | )           |   | 10.019                           |   |   | 1.000 |   | - |   |   | 15.125 |   |
| Exercised                                                            |   |       | (6,249,634 | )           |   | 5.390                            |   |   | 1.000 |   | - |   |   | 8.460 |   |
| **Outstanding                at January 29, 2005**                   |   |       | 5,504,466  |        |   | 5.549                            |   |   | 1.000 |   | - |   |   | 8.460 |   |
| Granted **-**option                price equal to market price  |   |       | 55,582     |        |   | 9.287                            |   |   | 9.100 |   | - |   |   | 12.480 |   |
| Granted **-**option                price less than market price |   |       | 0          |        |   | -                                |   |   | - |   | - |   |   | - |   |
| Canceled/forfeited                                                   |   |       | (22,386    | )           |   | 5.516                            |   |   | 1.000 |   | - |   |   | 8.250 |   |
| Exercised                                                            |   |       | (1,865,554 | )           |   | 5.130                            |   |   | 1.000 |   | - |   |   | 8.460 |   |
| **Outstanding                at January 28, 2006**                   |   |       | 3,672,108  |        | $      | 5.819                            |   | $ | 1.000 |   | - |   | $ | 12.480 |   |

**“**
**NOTE      1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES;**
** **
***Common      Stock Plans***
**”**

|                                               |   | **2006** |   | **2005** |   | **2004** |   |
|----------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                               |   |     |   |     |   |     |   |   |   |   |
| Option                price equal to market price  |   | $        | 2.44   |     | $      | 2.44     |   | $ | 1.14 |   |
| Option                price less than market price |   |     | 8.67   |     |   | 7.70     |   |   | 3.51 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                        |   |       |      |         |   | **Weighted**  |   |
|---------------------------------------------|--------|------------|-----------|--------------|--------|---------------|--------|
|                                        |   |       |      | **Weighted** |   | **Average**   |   |
|                                        |   |       |      | **Average**  |   | **Remaining** |   |
|                                        |   | **Option** |      | **Option**   |   | **Life**      |   |
| **Ranges                of Option Prices**  |   | **Shares** |      | **Price**    |   | **(Years)**   |   |
|                                        |   |       |      |         |   |          |   |   |   |   |
| **$0.00** **-                $1.00:**  |   |       |      |         |   |          |   |   |   |   |
| Options                outstanding          |   |       | 71,738    |         | $      | 1.000         |   |   | 5.96 |   |
| Options                exercisable          |   |       | 23,321    |         |   | 1.000         |   |   |   |   |
| **$1.01** **-                $5.00:**  |   |       |      |         |   |          |   |   |   |   |
| Options                outstanding          |   |       | 759,095   |         | $      | 3.987         |   |   | 2.83 |   |
| Options                exercisable          |   |       | 734,667   |         |   | 3.999         |   |   |   |   |
| **$5.01** **-                $12.48:** |   |       |      |         |   |          |   |   |   |   |
| Options                outstanding          |   |       | 2,841,275 |         | $      | 6.430         |   |   | 4.08 |   |
| Options                exercisable          |   |       | 2,332,627 |         |   | 6.402         |   |   |   |   |

**-**
**-**

**NOTE      11. EMPLOYEE STOCK PURCHASE PLAN**

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**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      12. SHAREHOLDER RIGHTS PLAN**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      13. CUSTOMER LOYALTY CARD PROGRAMS**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      14. EMPLOYEE RETIREMENT BENEFIT PLANS**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      15. EXPENSES RELATED TO COST REDUCTION PLAN**

*“Accounting      for Costs Associated with Exit or Disposal Activities.”*

|                              |   | **Expenses** |   | **Payments/**   |   | **Ending**  |   |
|-----------------------------------|--------|--------------|--------|-----------------|--------|-------------|--------|
| **(In                thousands)** |   | **Incurred** |   | **Settlements** |   | **Accrual** |   |
|                              |   |         |   |            |   |        |   |   |   |   |
| Fiscal                2005   |   | $            | 605    |            | $      | (3,201      | )      | $ | 0 |   |
|                              |   |         |   |            |   |        |   |   |   |   |
| Fiscal                2004   |   |         | 11,534 |            |   | (8,938      | )      |   | 2,596 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      16. NET INCOME PER SHARE**

| **(In                thousands)**                                                       |   | **2006** |    | **2005** |   | **2004** |   |
|-----------------------------------------------------------------------------------------|--------|----------|---------|----------|--------|----------|--------|
|                                                                                    |   |     |    |     |   |     |   |   |   |   |
| Basic                weighted average common shares outstanding                    |   |     | 119,831 |     |   | 116,196  |   |   | 112,491 |   |
| Dilutive                effect of assumed conversion of convertible notes          |   |     | 15,182  |     |   | 15,182   |   |   | 15,182 |   |
| Dilutive                effect of stock options                                    |   |     | 2,051   |     |   | 1,796    |   |   | 885 |   |
| Diluted                weighted average common shares and equivalents outstanding  |   |     | 137,064 |     |   | 133,174  |   |   | 128,558 |   |
|                                                                                    |   |     |    |     |   |     |   |   |   |   |
| Net                income                                                          |   | $        | 99,391  |     | $      | 64,526   |   | $ | 38,042 |   |
| Decrease                in interest expense from assumed conversion of notes,           |   |     |    |     |   |     |   |   |   |   |
| net                of income taxes                                                      |   |     | 4,514   |     |   | 4,539    |   |   | 4,334 |   |
| Net                income used to determine diluted earnings per share             |   | $        | 103,905 |     | $      | 69,065   |   | $ | 42,376 |   |

|                                                     |   | **2006** |   | **2005** |   | **2004** |   |
|----------------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                                     |   |     |   |     |   |     |   |   |   |   |
| Number                of shares (thousands)              |   |     | 0      |     |   | 369      |   |   | 8,255 |   |
| Weighted                average exercise price per share |   | $        | 0.00   |     | $      | 8.28     |   | $ | 6.63 |   |

**NOTE      17. ASSET SECURITIZATION**

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

| **(In                thousands)**                     |   | **2006** |   | **2005** |   | **2004** |   |
|-------------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                                  |   |     |   |     |   |     |   |   |   |   |
| Additions                to the I/O strip             |   | $        | 24,861 |     | $      | 12,396   |   | $ | 13,638 |   |
| Amortization                and valuation adjustments |   |     | 20,190 |     |   | 11,214   |   |   | 14,000 |   |
| Value                of the I/O strip at end of year  |   |     | 15,061 |     |   | 10,390   |   |   | 9,208 |   |

** **

| **(In                thousands)**                              |   | **2006** |   | **2005** |   | **2004** |   |
|----------------------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|
|                                                           |   |     |   |     |   |     |   |   |   |   |
| Additions                to the servicing liability            |   | $        | 3,661  |     | $      | 2,828    |   | $ | 4,011 |   |
| Amortization                of the servicing liability         |   |     | 3,768  |     |   | 3,474    |   |   | 2,141 |   |
| Value                of the servicing liability at end of year |   |     | 2,297  |     |   | 2,404    |   |   | 3,050 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

| **(In                thousands)**                                             |   | **2006** |    | **2005** |   | **2004** |   |
|-------------------------------------------------------------------------------|--------|----------|---------|----------|--------|----------|--------|
|                                                                          |   |     |    |     |   |     |   |   |   |   |
| Proceeds                from sales of new receivables to QSPE                 |   | $        | 638,624 |     | $      | 335,875  |   | $ | 331,718 |   |
| Collections                reinvested in revolving-period securitizations     |   |     | 616,336 |     |   | 409,796  |   |   | 422,793 |   |
| Cash                flows received on retained interests                      |   |     | 63,586  |     |   | 46,999   |   |   | 41,951 |   |
| Servicing                fees received                                        |   |     | 6,510   |     |   | 4,826    |   |   | 6,634 |   |
| Net                credit losses                                              |   |     | 21,229  |     |   | 18,003   |   |   | 30,850 |   |
| Investor                certificates outstanding at end of year               |   |     | 354,040 |     |   | 295,750  |   |   | 269,425 |   |
| Credit                card accounts 90 or more days delinquent at end of year |   |     | 9,037   |     |   | 7,952    |   |   | 9,795 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                             | **January                28,** | **January                29,** |
|--------------------------------------------------|--------------------------------|--------------------------------|
|                                             | **2006**                       | **2005**                       |
|                                             |                           |                           |
| Payment                rate                      | 11.7-17.2%                     | 11.1%                          |
| Residual                cash flows discount rate | 15.5%                          | 14.5%                          |
| Net                credit loss percentage        | 8.5-12.8%                      | 10.5%                          |
| Average                life of receivables sold  | 0.5-0.7                years   | 0.8                years       |

*“Accounting      for Transfers and Servicing of Financial Assets and Extinguishments of      Liabilities.”*

| **(In                thousands)**                |   | **10%                Change** |   | **20%                Change** |   |
|--------------------------------------------------|--------|-------------------------------|--------|-------------------------------|--------|
|                                             |   |                          |   |                          |   |   |   |
| Payment                rate                      |   | $                             | 975    |                          | $      | 1,867 |   |
| Residual                cash flows discount rate |   |                          | 68     |                          |   | 136 |   |
| Credit                loss percentage            |   |                          | 932    |                          |   | 1,848 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**“**
**NOTE      6. AVAILABLE-FOR-SALE SECURITIES**
**”**

| **(In                thousands)**                                                                                        |   | **2006** |    | **2005** |   | **2004** |   |
|--------------------------------------------------------------------------------------------------------------------------|--------|----------|---------|----------|--------|----------|--------|
|                                                                                                                     |   |     |    |     |   |     |   |   |   |   |
| Net                funding received from sales of receivables:                                                           |   |     |    |     |   |     |   |   |   |   |
| LANE                BRYANT                                                                                               |   | $        | 332,885 |     | $      | 284,426  |   | $ | 262,004 |   |
| CATHERINES                                                                                                               |   |     | -       | (1)      |   | 96,717   |   |   | 98,900 |   |
|                                                                                                                     |   |     |    |     |   |     |   |   |   |   |
| Net                accounts receivable balance held by third party                                                       |   |     |    |     |   |     |   |   |   |   |
| at                end of year:                                                                                           |   |     |    |     |   |     |   |   |   |   |
| LANE                BRYANT                                                                                               |   |     | 209,368 |     |   | 199,098  |   |   | 198,272 |   |
| CATHERINES                                                                                                               |   |     | -       | (1)      |   | 58,167   |   |   | 70,416 |   |
| ____________________                                                                                                     |   |     |    |     |   |     |   |   |   |   |
| (1) Spirit                of America National Bank acquired the CATHERINES portfolio in Fiscal                2006. |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      18. LEASES**

| **(In                thousands)** |   | **2006** |    | **2005** |   | **2004** |   |
|-----------------------------------|--------|----------|---------|----------|--------|----------|--------|
|                              |   |     |    |     |   |     |   |   |   |   |
| Minimum                rent       |   | $        | 207,534 |     | $      | 193,256  |   | $ | 192,902 |   |
| Contingent                rent    |   |     | 34,785  |     |   | 32,709   |   |   | 31,846 |   |
|                              |   | $        | 242,319 |     | $      | 225,965  |   | $ | 224,748 |   |

**-      **
**-      **
**-      **
**-      **
**-      **
**-      **

**-      **
**-      **
**-      **
**-      **
**-      **
**-      **

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      19. SEGMENT REPORTING**

**,      **

**“**
**NOTE      1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
**”      **

|                                                                                                            |   | **Retail** |      | **Direct-to-**      |   | **Corporate**                |   |             |    |
|-----------------------------------------------------------------------------------------------------------------|--------|------------|-----------|---------------------|--------|------------------------------|--------|------------------|---------|
| **(In                thousands)**                                                                               |   | **Stores** |      | **Consumer****(1)** |   | **and                Other** |   | **Consolidated** |    |
|                                                                                                            |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| **Fiscal                2006**                                                                                  |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| Net                sales                                                                                   |   | $          | 2,453,042 |                | $      | 298,888                      |   | $                | 3,795   |   | $ | 2,755,725 |   |
| Depreciation                and amortization                                                               |   |       | 44,031    |                |   | 1,235                        |   |             | 45,845  |   |   | 91,111 |   |
| Income                before interest and taxes                                                            |   |       | 176,500   |                |   | 19,918                       |   |             | (26,106 | ) |   | 170,312 |   |
| Interest                expense                                                                            |   |       |      |                |   |                         |   |             | (17,911 | ) |   | (17,911 | ) |
| Income                tax provision                                                                        |   |       |      |                |   |                         |   |             | (53,010 | ) |   | (53,010 | ) |
| Net                income                                                                                  |   |       | 176,500   |                |   | 19,918                       |   |             | (97,027 | ) |   | 99,391 |   |
| Capital                expenditures                                                                        |   |       | 74,598    |                |   | 2,394                        |   |             | 26,843  |   |   | 103,835 |   |
|                                                                                                            |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| **As                of January 28, 2006**                                                                       |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| Total                assets                                                                                |   | $          | 757,856   |                | $      | 345,357                      |   | $                | 463,782 |   | $ | 1,566,995 |   |
| *____________________*                                                                                          |
| *(1)* *From                date of acquisition of Crosstown Traders, Inc. on June 2,                2005.* |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

|                                                                                                            |   | **Retail** |      | **Direct-to-**      |   | **Corporate**                |   |             |    |
|-----------------------------------------------------------------------------------------------------------------|--------|------------|-----------|---------------------|--------|------------------------------|--------|------------------|---------|
| **(In                thousands)**                                                                               |   | **Stores** |      | **Consumer****(1)** |   | **and                Other** |   | **Consolidated** |    |
|                                                                                                            |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| **Fiscal                2005**                                                                                  |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| Net                sales                                                                                   |   | $          | 2,330,483 |                |   |                         |   | $                | 4,253   |   | $ | 2,334,736 |   |
| Depreciation                and amortization                                                               |   |       | 44,341    |                |   |                         |   |             | 35,265  |   |   | 79,606 |   |
| Income                before interest and taxes                                                            |   |       | 143,886   |                |   |                         |   |             | (26,608 | ) |   | 117,278 |   |
| Interest                expense                                                                            |   |       |      |                |   |                         |   |             | (15,610 | ) |   | (15,610 | ) |
| Income                tax provision                                                                        |   |       |      |                |   |                         |   |             | (37,142 | ) |   | (37,142 | ) |
| Net                income                                                                                  |   |       | 143,886   |                |   |                         |   |             | (79,360 | ) |   | 64,526 |   |
| Capital                expenditures                                                                        |   |       | 34,115    |                |   |                         |   |             | 26,450  |   |   | 60,565 |   |
|                                                                                                            |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| **As                of January 29, 2005**                                                                       |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| Total                assets                                                                                |   | $          | 718,444   |                |   |                         |   | $                | 585,327 |   | $ | 1,303,771 |   |
|                                                                                                            |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| **Fiscal                2004**                                                                                  |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| Net                sales                                                                                   |   | $          | 2,284,976 |                |   |                         |   | $                | 3,387   |   | $ | 2,288,363 |   |
| Depreciation                and amortization                                                               |   |       | 47,840    |                |   |                         |   |             | 36,694  |   |   | 84,534 |   |
| Income                before interest and taxes                                                            |   |       | 115,988   |                |   |                         |   |             | (40,856 | ) |   | 75,132 |   |
| Interest                expense                                                                            |   |       |      |                |   |                         |   |             | (15,609 | ) |   | (15,609 | ) |
| Income                tax provision                                                                        |   |       |      |                |   |                         |   |             | (21,623 | ) |   | (21,623 | ) |
| Minority                interest in net loss of                                                                 |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| consolidated                subsidiary                                                                     |   |       | 142       |                |   |                         |   |             | 0       |   |   | 142 |   |
| Net                income                                                                                  |   |       | 116,130   |                |   |                         |   |             | (78,088 | ) |   | 38,042 |   |
| Capital                expenditures                                                                        |   |       | 29,610    |                |   |                         |   |             | 24,418  |   |   | 54,028 |   |
|                                                                                                            |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| **As                of January 31, 2004**                                                                       |   |       |      |                |   |                         |   |             |    |   |   |   |   |
| Total                assets                                                                                |   | $          | 722,912   |                |   |                         |   | $                | 450,158 |   | $ | 1,173,070 |   |
| *____________________*                                                                                          |
| *(1)* *From                date of acquisition of Crosstown Traders, Inc. on June 2,                2005.* |

|                              |   | **January                28,** |    | **January                29,** |   |
|-----------------------------------|--------|--------------------------------|---------|--------------------------------|--------|
| **(In                thousands)** |   | **2006**                       |    | **2005**                       |   |
|                              |   |                           |    |                           |   |   |   |
| **Retail                Stores:** |   |                           |    |                           |   |   |   |
| LANE                BRYANT        |   | $                              | 23,436  |                           | $      | 23,436 |   |
| CATHERINES                        |   |                           | 43,230  |                           |   | 43,230 |   |
|                              |   |                           |    |                           |   |   |   |
| **Direct-to-Consumer:**           |   |                           |    |                           |   |   |   |
| Crosstown                Traders  |   |                           | 87,887  |                           |   | 0 |   |
|                              |   | $                              | 154,553 |                           | $      | 66,666 |   |

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**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      20. FAIR VALUE OF FINANCIAL INSTRUMENTS**

|                                                       |   | **January                28, 2006** |    | **January                29, 2005** |   |
|------------------------------------------------------------|--------|-------------------------------------|---------|-------------------------------------|--------|
|                                                       |   | **Carrying**                        |    | **Fair**                            |   | **Carrying** |   | **Fair** |   |
| **(In                thousands)**                          |   | **Amount**                          |    | **Value**                           |   | **Amount** |   | **Value** |   |
|                                                       |   |                                |    |                                |   |   |   |   |   |   |   |   |   |
| **Assets:**                                                |   |                                |    |                                |   |   |   |   |   |   |   |   |   |
| Cash                and cash equivalents                   |   | $                                   | 130,132 |                                | $      | 130,132 |   | $ | 273,049 |   | $ | 273,049 |   |
| Available-for-sale                securities               |   |                                | 87,218  |                                |   | 87,218 |   |   | 53,097 |   |   | 53,097 |   |
|                                                       |   |                                |    |                                |   |   |   |   |   |   |   |   |   |
| **Liabilities:**                                           |   |                                |    |                                |   |   |   |   |   |   |   |   |   |
| 4.75%                Senior Convertible Notes due 2012     |   |                                | 150,000 |                                |   | 203,610 |   |   | 150,000 |   |   | 164,115 |   |
| Revolving                credit facility                   |   |                                | 50,000  |                                |   | 50,000 |   |   | 0 |   |   | 0 |   |
| 6.07%                mortgage note, due October 2014       |   |                                | 12,261  |                                |   | 12,151 |   |   | 12,821 |   |   | 12,869 |   |
| 6.53%                mortgage note, due November 2012      |   |                                | 9,450   |                                |   | 9,397 |   |   | 10,850 |   |   | 10,858 |   |
| 7.77%                mortgage note, due December 2011      |   |                                | 9,050   |                                |   | 9,386 |   |   | 9,564 |   |   | 10,072 |   |
| Variable                rate mortgage note, due March 2006 |   |                                | 0       |                                |   | 0 |   |   | 5,605 |   |   | 5,605 |   |
| Other                long-term debt                        |   |                                | 1,158   |                                |   | 1,016 |   |   | 1,399 |   |   | 1,201 |   |

**NOTE      21. RESTRUCTURING CREDIT**

**.**
** **

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Table            of Contents

**CHARMING      SHOPPES, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**YEAR      ENDED JANUARY 28, 2006**

**(Continued)**

**NOTE      22. QUARTERLY FINANCIAL INFORMATION (Unaudited)**

|                                                        |   | **First**   |    | **Second**  |   | **Third**   |   | **Fourth**  |    |
|-------------------------------------------------------------|--------|-------------|---------|-------------|--------|-------------|--------|-------------|---------|
| **(In                thousands, except per share amounts)** |   | **Quarter** |    | **Quarter** |   | **Quarter** |   | **Quarter** |    |
|                                                        |   |        |    |        |   |        |   |        |    |   |   |   |   |
| **Fiscal                2006**                              |   |        |    |        |   |        |   |        |    |   |   |   |   |
| Net                sales                                    |   | $           | 603,353 |        | $      | 689,075     |   | $           | 663,677 |   | $ | 799,620 |   |
| Gross                profit                                 |   |        | 199,431 |        |   | 221,874     |   |        | 201,871 |   |   | 221,274 |   |
| Net                income                                   |   |        | 30,017  |        |   | 39,424      |   |        | 10,762  |   |   | 19,188 |   |
| Basic                net income per share                   |   | $           | .25     |        | $      | .33         |   | $           | .09     |   | $ | .16 |   |
| Diluted                net income per share                 |   |        | .23     |        |   | .30         |   |        | .09     |   |   | .15 |   |
|                                                        |   |        |    |        |   |        |   |        |    |   |   |   |   |
| **Fiscal                2005**                              |   |        |    |        |   |        |   |        |    |   |   |   |   |
| Net                sales                                    |   | $           | 592,518 |        | $      | 612,261     |   | $           | 542,005 |   | $ | 587,952 |   |
| Gross                profit                                 |   |        | 190,964 |        |   | 180,224     |   |        | 163,226 |   |   | 157,672 |   |
| Net                income                                   |   |        | 26,249  |        |   | 27,059      |   |        | 6,353   |   |   | 4,865 |   |
| Basic                net income per share                   |   | $           | .23     |        | $      | .23         |   | $           | .05     |   | $ | .04 |   |
| Diluted                net income per share                 |   |        | .21     |        |   | .21         |   |        | .05     |   |   | .04 |   |

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**Item      9. Changes In and Disagreements With Accountants on Accounting and Financial      Disclosure**

**Item      9A. Controls and Procedures**

**Evaluation      of Disclosure Controls and Procedures**

**Evaluation      of Internal Control Over Financial Reporting**

**-**

**Changes      in Internal Control Over Financial Reporting**

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**Item      9B. Other Information**

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Table            of Contents

**PART      III**

**Item      10. Directors and Executive Officers of the Registrant**

**“Directors      Standing for Election”**
**“Biographies      of Directors”**
**“Corporate      Governance at Charming Shoppes”**
**“Compensation      of Directors”**
**“Section      16(a) Beneficial Ownership Reporting Compliance”**
**“Additional      Part I Information - Our Executive Officers,”**

**www.charmingshoppes.com**
**“About      Us”**

**Item      11. Executive Compensation**

**“Management      Compensation”**
**“Report      of the Compensation and Stock Option Committees of the Board of Directors on      Executive Compensation”**
**“Stock      Performance Chart,” **

**Item      12. Security Ownership of Certain Beneficial Owners and Management and Related      Stockholder Matters**

**“Equity      Compensation Plan Information”**
**“Principal      Shareholders and Management Ownership”**

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**Item      13. Certain Relationships and Related Transactions**

**“Compensation      Committee Interlocks and Insider Participation”**

**Item      14. Principal Accountant Fees and Services**

**“Audit      and Other Fees”**

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Table            of Contents

**PART      IV**

**Item      15. Exhibits and Financial Statement Schedules**

|                                                                                                                                   | **Page** |
|----------------------------------------------------------------------------------------------------------------------------------------|----------|
|                                                                                                                                   |     |
| Management’s                Report on Internal Control over Financial Reporting                                                  | 54       |
|                                                                                                                                   |     |
| Report                  of Independent Registered Public Accounting Firm on Internal Control                  Over Financial Reporting | 55-56    |
|                                                                                                                                   |     |
| Report                of Independent Registered Public Accounting Firm                                                                 | 57       |
|                                                                                                                                   |     |
| Consolidated                Balance Sheets - January 28, 2006 and January 29, 2005                                                     | 58       |
|                                                                                                                                   |     |
| Consolidated                Statements of Operations and Comprehensive Income **-**                                                    |     |
| Years                Ended January 28, 2006, January 29, 2005, and January 31,                2004                                     | 59       |
|                                                                                                                                   |     |
| Consolidated                Statements of Stockholders’ Equity - Years Ended                                                     |     |
| January                28, 2006, January 29, 2005, and January 31, 2004                                                                | 60       |
|                                                                                                                                   |     |
| Consolidated                Statements of Cash Flows - Years Ended                                                                     |     |
| January                28, 2006, January 29, 2005, and January 31, 2004                                                                | 61       |
|                                                                                                                                   |     |
| Notes                to Consolidated Financial Statements                                                                              | 62       |

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**Plan      of Acquisition, Reorganization, Arrangement, Liquidation, or      Succession**

| 2.1 | Covenant                Agreement, dated as of August 16, 2001, between Charming Shoppes,                Inc. and                Limited Brands, Inc., incorporated by reference to Form 8-K of the                Registrant dated August 16, 2001, filed on August 31, 2001. (Exhibit                2.3). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.2 | Master                Sublease, dated as of August 16, 2001, between Limited Brands, Inc.                and                Lane Bryant, Inc., incorporated by reference to Form 8-K of the Registrant                dated August 16, 2001, filed on August 31, 2001. (Exhibit                2.4). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.3 | Stock                Purchase Agreement dated May 19, 2005 by and among Chestnut Acquisition                Sub, Inc., Crosstown Traders, Inc., the Securityholders of Crosstown                Traders, Inc. whose names are set forth on the signature pages thereto                and                J.P. Morgan Partners (BHCA), L.P., as the Sellers’ Representative,                incorporated by reference to Form 8-K of the Registrant dated June                2,                2005, filed on June 8, 2005. (File No. 000-07258, Exhibit                2.1). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Articles      of Incorporation and By-Laws**

| 3.1 | Restated                Articles of Incorporation, incorporated by reference to Form 10-K                of the                Registrant for the fiscal year ended January 29, 1994. (File No.                000-07258, Exhibit 3.1). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2 | By-Laws,                as Amended and Restated, incorporated by reference to Form 10-Q of                the                Registrant for the quarter ended July 31, 1999. (File No. 000-07258,                Exhibit 3.2). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Instruments      Defining the Rights of Security Holders, Including      Indentures**

| 4.1 | Amended                and Restated Rights Agreement, dated as of February 1, 2001, between                Charming Shoppes, Inc. and American Stock Transfer & Trust Company, as                Rights Agent, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended February 3, 2001. (File No. 000-07258, Exhibit                4.1). |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.2 | Registration                Agreement, dated as of August 16, 2001, between Charming Shoppes,                Inc. and                Limited Brands, Inc., incorporated by reference to Form 8-K of the                Registrant dated August 16, 2001, filed on August 31, 2001. (File                No.                000-07258, Exhibit 4.1). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.3 | Indenture,                dated as of May 28, 2002, between Charming Shoppes, Inc. and Wachovia                Bank, National Association, incorporated by reference to Form 10-Q                of the                Registrant for the quarter ended May 4, 2002. (File No. 000-07258,                Exhibit                4.1). |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 4.4 | Registration                Rights Agreement, dated as of May 28, 2002, by and among Charming                Shoppes,                Inc., as Issuer, and J. P. Morgan Securities, Inc., Bear Stearns&                Co., Inc., First Union Securities, Inc., Lazard Freres & Co., LLC, and                McDonald Investments, Inc., as Initial Purchasers, incorporated by                reference to Form 10-Q of the Registrant for the quarter ended May                4,                2002. (File No. 000-07258, Exhibit                4.2). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.5 | Amended                and Restated Loan and Security Agreement, dated as of January 29,                2004, by                and among Charming Shoppes, Inc., Charming Shoppes of Delaware, Inc.,                CSI                Industries, Inc., Catherine Stores Corporation, Lane Bryant, Inc.                and FB                Apparel, Inc., as Borrowers; Charming Shoppes of Delaware, Inc.,                as                Borrowers’ Agent; Congress Financial Corporation, as Administrative Agent,                Collateral Agent, and Joint Bookrunner; J.P. Morgan Business Credit                Corp.,                as Co-Documentation Agent, Joint Lead Arranger, and Joint Bookrunner;                Wachovia Bank, National Association, as Joint Lead Arranger; Bank                of                America, N.A. and Fleet Retail Group, Inc., as Co-Documentation Agents;                and The Financial Institutions named therein, as Lenders, incorporated                by                reference to Form 8-K of the Registrant dated February 4, 2004. (File                No.                000-07258, Exhibit 99.2). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.6 | Second                Amended and Restated Loan and Security Agreement, dated July 28,                2005, by                and among Charming Shoppes, Inc., Charming Shoppes of Delaware, Inc.,                CSI                Industries, Inc., FB Apparel, Inc., Catherines Stores Corporation,                Lane                Bryant, Inc., and Crosstown Traders, Inc. as borrowers; a syndicate                of                banks and other financial institutions as lenders, including Wachovia                Bank, National Association as agent for the lenders; and certain                of the                Company’s subsidiaries as guarantors, incorporated by reference to Form                8-K of the Registrant dated July 28, 2005, filed on August 3, 2005.                (File                No. 000-07258, Exhibit 10.1).. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Material      Contracts**

| 10.1.1 | Second                Amended and Restated Pooling and Servicing Agreement, dated as of                November                25, 1997, as amended on July 22, 1999, among Charming Shoppes Receivables                Corp., as Seller, Spirit of America, Inc., as Servicer, and First                Union                National Bank as Trustee, incorporated by reference to Form 8-K of                Charming Shoppes Master Trust and Charming Shoppes Receivables Corp.,                (File No. 333-71757) dated July 22, 1999. (Exhibit No.                4.1). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.2 | Fourth                Amendment, dated as of August 5, 2004, to Second Amended and Restated                Pooling and Servicing Agreement, dated as of November 25, 1997, as                amended                on July 22, 1999 and on May 8, 2001, among Charming Shoppes Receivables                Corp., as Seller, Spirit of America, Inc., as Servicer, and Wachovia                Bank,                National Association (formerly known as First Union National Bank)                as                Trustee, incorporated by reference to Form 10-Q of the Registrant                for the                quarter ended July 31, 2004 (File No. 000-07258, Exhibit                10.4). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.3 | Amendment,                dated as of March 18, 2005, to Second Amended and Restated Pooling                and                Servicing Agreement, dated as of November 25, 1997, as amended on                July 22,                1999, May 8, 2001, and August 5, 2004, among Charming Shoppes Receivables                Corp., as Seller, Spirit of America, Inc., as Servicer, and Wachovia                Bank,                National Association, as Trustee, incorporated by reference to Form                10-K                of the Registrant for the fiscal year ended January 29, 2005. (File                No.                000-07258, Exhibit 10.1.3). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.1.4 | Series                1999-1 Supplement, dated as of July 22, 1999, to Second Amended and                Restated Pooling and Service Agreement, dated as of November 25,                1997, as                amended on July 22, 1999, among Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and First Union National                Bank, as Trustee, for $150,000,000 Charming Shoppes Master Trust                Asset-Backed Certificates Series 1999-1, incorporated by reference                to Form                8-K of Charming Shoppes Master Trust and Charming Shoppes Receivables                Corp., (File No. 333-71757) dated July 22, 1999. (Exhibit No.                4.2). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.5 | Receivables                Purchase Agreement, dated as of May 28, 1999, among Charming Shoppes                Seller, Inc. as Seller, Spirit of America, Inc., as Servicer, Clipper                Receivables Corporation, as Purchaser, State Street Capital Corporation,                as Administrator, and State Street Bank & Trust Company, as                Relationship Bank, incorporated by reference to Form 10-K of the                Registrant for the fiscal year ended February 2, 2002. (File No.                000-07258, Exhibit 10.1.4). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.6 | Series                1999-2 Supplement, dated as of May 28, 1999, to Second Amended and                Restated Pooling and Service Agreement, dated as of November 25,                1997, as                amended on July 22, 1999, among Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and First Union National                Bank, as Trustee, for $55,750,000 Charming Shoppes Master Trust                Asset-Backed Certificates Series 1999-2, incorporated by reference                to Form                10-K of the Registrant for the fiscal year ended January 29, 2000.                (File                No. 000-07258, Exhibit 10.1.23). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.7 | Series                2000-VFC Supplement, dated as of November 9, 2000, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997,                among Charming Shoppes Receivables Corp., as Seller, Spirit of America,                Inc., as Servicer, and First Union National Bank, as Trustee, on                behalf of                the Series 2000-VFC Certificateholders, for up to $60,122,700 Charming                Shoppes Master Trust Series 2000-VFC, incorporated by reference to                Form                10-K of the Registrant for the fiscal year ended February 3, 2001.                (File                No. 000-07258, Exhibit 10.1.16). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.8 | Certificate                Purchase Agreement, dated as of November 9, 2000, among Charming                Shoppes                Receivables Corp. as Seller and as the Class B Purchaser, Spirit                of                America, Inc. as Servicer, Monte Rosa Capital Corporation as the                Conduit                Purchaser, and ING Baring (U.S.) Capital Markets LLC as Administrator                for                the Conduit Purchaser, incorporated by reference to Form 10-K of                the                Registrant for the fiscal year ended February 3, 2001. (File No.                000-07258, Exhibit 10.1.17). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.9 | Purchase                Agreement dated as of March 14, 2005 between Citibank USA, N.A.,                Spirit of                America National Bank and Catherines, Inc., incorporated by reference                to                Form 8-K of the Registrant dated March 18, 2005, filed on March 22,                2005.                (File No. 000-07258, Exhibit 99). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.10 | Credit                Card Processing Agreement, among World Financial Network National                Bank,                Lane Bryant, Inc., and Sierra Nevada Factoring, Inc., dated as of                January                31, 1996, incorporated by reference to Form 10-K of the Registrant                for the                fiscal year ended February 2, 2002. (File No. 000-07258, Exhibit                10.1.9). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.11 | Amendment                to Credit Card Processing Agreement, among World Financial Network                National Bank, Lane Bryant, Inc., and Sierra Nevada Factoring, Inc.,                dated                as of January 28, 2005, incorporated by reference to Form 10-K of                the                Registrant for the fiscal year ended January 29, 2005. (File No.                000-07258, Exhibit 10.1.12). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.12 | Purchase                and Sale Agreement, among Spirit of America National Bank, as Seller,                and                Charming Shoppes Receivables Corp., as Purchaser, dated as of November                25,                1997, incorporated by reference to Form S-1/A of Charming Shoppes                Receivables Corp. (File No. 333-71757) (Exhibit 10.1(a)). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.1.13 | First                Amendment to Purchase and Sale Agreement, among Spirit of America                National                Bank, as Seller, and Charming Shoppes Receivables Corp., as Purchaser,                dated as of July 22, 1999, incorporated by reference to Form 8-K                of                Charming Shoppes Receivables Corp. (File No. 333-71757) (Exhibit                10.1). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.14 | Series                2002-1 Supplement, dated as of November 20, 2002, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997, as                amended on July 22, 1999 and on May 8, 2001, among Charming Shoppes                Receivables Corp., as Seller, Spirit of America, Inc., as Servicer,                and                Wachovia Bank, National Association, as Trustee, for $100,000,000                Charming                Shoppes Master Trust Asset-Backed Certificates Series 2002-1, incorporated                by reference to Form 10-Q of the Registrant for the quarter ended                November                2, 2002. (File No. 000-07258, Exhibit                10.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.15 | Charming                Shoppes Master Trust $63,500,000 Fixed Rate Class A Asset Backed                Certificates, Series 2002-1 and $16,500,000 Fixed Rate Class B Asset                Backed Certificates, Series 2002-1 Certificate Purchase Agreement,                dated                as of November 22, 2002, incorporated by reference to Form 10-Q of                the                Registrant for the quarter ended November 2, 2002. (File No. 000-07258,                Exhibit 10.2). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.16 | Certificate                Purchase Agreement, dated as of November 22, 2002, among Wachovia                Bank,                National Association, as Trustee, Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and The Class C Holders                described therein, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended November 2, 2002. (File No. 000-07258,                Exhibit 10.3). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.17 | Certificate                Purchase Agreement, dated as of November 22, 2002, among Wachovia                Bank,                National Association, as Trustee, Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and The Class D Holders                described therein, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended November 2, 2002. (File No. 000-07258,                Exhibit 10.4). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.18 | $14,000,000                Promissory Note, dated October 2002, between White Marsh Distribution,                LLC., as Borrower, and General Electric Capital Business Asset Funding                Corporation, as Payee and Holder, incorporated by reference to Form                10-Q                of the Registrant for the quarter ended November 2, 2002. (File No.                000-07258, Exhibit 10.5). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.19 | Commercial                Deed of Trust, Security Agreement, Assignment of Leases and Rents,                and                Fixture Filing, made as of October 2002, among the Grantor, White                Marsh                Distribution, LLC, as Borrower, in favor of James M. Smith, as Trustee,                for the benefit of the Beneficiary, General Electric Capital Business                Asset Funding Corporation, as Lender, incorporated by reference to                Form                10-Q of the Registrant for the quarter ended November 2, 2002. (File                No.                000-07258, Exhibit 10.6). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.20 | Certificate                Purchase Agreement, dated as of January 21, 2004, among Charming                Shoppes                Receivables Corp., as Seller and as the Class B Purchaser, Spirit                of                America, Inc., as Servicer, Sheffield Receivables Corporation, as                the                Conduit Purchaser, and Barclay’s Bank PLC as Administrator for the Conduit                Purchaser, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended January 31, 2004. (File No. 000-07258, Exhibit                10.1.17). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.21 | Series                2004-VFC Supplement, dated as of January 21, 2004, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997 and                amended as of July 22, 1999 and as of May 8, 2001, among Charming                Shoppes                Receivables Corp., as Seller, Spirit of America, Inc., as Servicer,                and                Wachovia Bank, National Association, as Trustee on behalf of the                Series                2004-VFC Certificateholders, for up to $132,000,000 Charming Shoppes                Master Trust Asset-Backed Certificates Series 2004-VFC, incorporated                by                reference to Form 10-K of the Registrant for the fiscal year ended                January                31, 2004. (File No. 000-07258, Exhibit                10.1.18). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.1.22 | Series                2004-1 Supplement, dated as of August 5, 2004, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997 (as                amended on July 22, 1999, on May 8, 2001 and on August 5, 2004),                among                Charming Shoppes Receivables Corp., as Seller, Spirit of America,                Inc., as                Servicer, and Wachovia Bank, National Association, as Trustee, on                behalf                of the Series 2004-1 Certificateholders, for $180,000,000 Charming                Shoppes                Master Trust Series 2004-1, incorporated by reference to Form 10-Q                of the                Registrant for the quarter ended July 31, 2004 (File No. 000-07258,                Exhibit 10.5). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.23 | Certificate                Purchase Agreement, dated as of July 21, 2004, among Charming Shoppes                Receivables Corp., Fashion Service Corp., Spirit of America, Inc.,                and                Barclay’s Capital Inc. (as representative of the Initial Purchasers),                incorporated by reference to Form 10-Q of the Registrant for the                quarter                ended July 31, 2004 (File No. 000-07258, Exhibit                10.6). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.24 | Certificate                Purchase Agreement, dated as of August 5, 2004, among Wachovia Bank,                National Association as Trustee, Charming Shoppes Receivables Corp.                as                Seller, Spirit of America, Inc. as Servicer, and Clipper Receivables                Company LLC as Initial Class C Holder, incorporated by reference                to Form                10-Q of the Registrant for the quarter ended July 31, 2004 (File                No.                000-07258, Exhibit 10.7). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.25 | Mortgage,                Assignment of Leases and Rents and Security Agreement, dated as of                October                6, 2004, between FB Distro Distribution Center, LLC, as Mortgagor,                and                BankAtlantic Commercial Mortgage Capital, LLC, as Mortgagee, incorporated                by reference to Form 10-Q of the Registrant for the quarter ended                October                30, 2004 (File No. 000-07258, Exhibit                10.9). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.26 | $13,000,000                Mortgage Note, dated October 6, 2004, between FB Distro Distribution                Center, LLC, as Maker, and BankAtlantic Commercial Mortgage Capital,                LLC,                as Payee, incorporated by reference to Form 10-Q of the Registrant                for the                quarter ended October 30, 2004 (File No. 000-07258, Exhibit                10.10). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.27 | Guaranty,                executed as of October 6, 2004, by Charming Shoppes, Inc., as Guarantor,                for the benefit of BankAtlantic Commercial Mortgage Capital, LLC,                as                Lender, incorporated by reference to Form 10-Q of the Registrant                for the                quarter ended October 30, 2004 (File No. 000-07258, Exhibit                10.11). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.28 | Hazardous                Substances Indemnity Agreement, dated October 6, 2004, by FB Distro                Distribution Center, LLC and by Charming Shoppes, Inc., jointly and                severally as Indemnitors, in favor of BankAtlantic Commercial Mortgage                Capital, LLC, as Holder, incorporated by reference to Form 10-Q of                the                Registrant for the quarter ended October 30, 2004 (File No. 000-07258,                Exhibit 10.12). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.29 | Amended                and Restated Class D Certificate Purchase Agreement, dated as of                August                25, 2004, among Wachovia Bank, National Association as Trustee, Charming                Shoppes Receivables Corp. as Seller and as Initial Class D-1 Holder,                Spirit of America, Inc. as Servicer, and Clipper Receivables Company                LLC,                as the Class D-1 Holder, incorporated by reference to Form 8-K of                the                Registrant dated August 24, 2004, filed on August 27, 2004. (File                No.                000-07258, Exhibit 99.1). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.30 | Amended                and Restated Certificate Purchase Agreement, dated as of November                22, 2004                and Amended and Restated as of November 18, 2004, among Wachovia                Bank,                National Association as Trustee, Charming Shoppes Receivables Corp.                as                Seller, Spirit of America, Inc. as Servicer, and the Class D-2                Certificateholders Described Herein, incorporated by reference to                Form                10-Q of the Registrant for the quarter ended October 30, 2004 (File                No.                000-07258, Exhibit 10.13). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.1.31 | Amended                and Restated Receivables Purchase Agreement, dated as of June 2,                2005,                among Catalog Receivables LLC as Seller, Spirit of America, Inc.                as                Servicer, Sheffield Receivables Corporation as Purchaser, and Barclays                Bank PLC as Administrator. |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Management      Contracts and Compensatory Plans and Arrangements**

| 10.2.1 | The                1988 Key Employee Stock Option Plan of Charming Shoppes, Inc., as                amended                and restated January 25, 2006. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.2 | Form                of Charming Shoppes, Inc. 1988 Key Employee Stock Option Plan Key                Employee                Stock Option Agreement. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.3 | The                1989 Non-Employee Director Stock Option Plan of Charming Shoppes,                Inc., as                amended, incorporated by reference to Form 10-K of the Registrant                for the                fiscal year ended January 30, 1993. (File No. 000-07258, Exhibit                10.2.5). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.4 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program,                incorporated by reference to Registration Statement on Form S-8 of                the                Registrant, dated February 25, 1997. (Registration No. 333-22323,                Exhibit                4.1). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.5 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program,                As                Amended and Restated, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended July 31, 1999. (File No. 000-07258,                Exhibit 10.1). |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.6 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program,                As                Amended and Restated at June 27, 2002, incorporated by reference                to Form                10-K of the Registrant for the fiscal year ended February 1, 2003.                (File                No. 000-07258, Exhibit 10.2.6). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.7 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program                Stock                Option Agreement, incorporated by reference to Form 10-Q of the Registrant                for the quarter ended July 31, 1999. (File No. 000-07258, Exhibit                10.2). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.8 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program                Restricted Stock Agreement, incorporated by reference to Form 10-Q                of the                Registrant for the quarter ended July 31, 1999. (File No. 000-07258,                Exhibit 10.3). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.9 | Form                of Charming Shoppes, Inc. 2003 Non-Employee Directors Compensation                Plan                Stock Option Agreement, incorporated by reference to Form 8-K of                the                Registrant dated June 23, 2005, filed on June 29, 2005. (File No.                000-07258, Exhibit 10.1). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.10 | Form                of Charming Shoppes, Inc. 2003 Non-Employee Directors Compensation                Plan                Restricted Share Units Agreement, incorporated by reference to Form                8-K of                the Registrant dated June 23, 2005, filed on June 29, 2005. (File                No.                000-07258, Exhibit 10.2). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.11 | The                1993 Employees’ Stock Incentive Plan of Charming Shoppes, Inc.,                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended January 29, 1994. (File No. 000-07258, Exhibit                10.2.10). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table            of Contents

| 10.2.12 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Restricted                Stock Agreement, dated as of February 11, 2002, incorporated by reference                to Form 10-K of the Registrant for the fiscal year ended February                2, 2002.                (File No. 000-07258, Exhibit                10.2.8). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.13 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Stock Option                Agreement (regular vesting schedule), incorporated by reference to                Form                10-K of the Registrant for the fiscal year ended February 2, 2002.                (File                No. 000-07258, Exhibit 10.2.20). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.14 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Stock Option                Agreement (accelerated vesting schedule), incorporated by reference                to                Form 10-K of the Registrant for the fiscal year ended February 2,                2002.                (File No. 000-07258, Exhibit                10.2.21). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.15 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan                Performance-Accelerated Stock Option Agreement, incorporated by reference                to Form 10-K of the Registrant for the fiscal year ended February                2, 2002.                (File No. 000-07258, Exhibit                10.2.22). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.16 | The                Charming Shoppes, Inc. Employee Stock Purchase Plan, as amended,                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended February 3, 1996. (File No. 000-07258, Exhibit                10.2.10). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.17 | The                Charming Shoppes Inc. 1999 Associates’ Stock Incentive Plan, incorporated                by reference to Form 10-K of the Registrant for the fiscal year ended                January 30, 1999. (File No. 000-07258, Exhibit                10.2.24). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.18 | Charming                Shoppes, Inc. 1999 Associates’ Stock Incentive Plan Stock Option                Agreement, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended January 30, 1999. (File No. 000-07258, Exhibit                10.2.25). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.19 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan, incorporated by reference to Form 10-K of the Registrant                for the fiscal year ended February 3, 2001. (File No. 000-07258,                Exhibit                10.2.29). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.20 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan Stock Option Agreement (regular vesting schedule)                ,                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended February 2, 2002. (File No. 000-07258, Exhibit                10.2.23). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.21 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan Stock Option Agreement (accelerated vesting schedule),                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended February 2, 2002. (File No. 000-07258, Exhibit                10.2.24). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.22 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan Restricted Stock Agreement, incorporated by reference                to                Form 10-K of the Registrant for the fiscal year ended February 2,                2002.                (File No. 000-07258, Exhibit                10.2.25). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.23 | 2004                Stock Award and Incentive Plan, incorporated by reference to Appendix                B of                the Registrant’s Proxy Statement Pursuant to Section 14 of the Securities                Exchange Act of 1934, filed on May 19,                2004. |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.24 | Charming                Shoppes, Inc. 2004 Stock Award and Incentive Plan Stock Option Agreement,                incorporated by reference to Form 10-Q of the Registrant for the                quarter                ended October 30, 2004 (File No. 000-07258, Exhibit                10.15). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 10.2.25 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Agreement - Section 16 Officers, incorporated by reference                to Form                8-K of the Registrant dated February 7, 2005, filed on February 11,                2005.                (File No. 000-07258, Exhibit 99.2) |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.26 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Performance                Share Agreement, incorporated by reference to Form 8-K of the Registrant                dated February 7, 2005, filed on February 11, 2005. (File No. 000-07258,                Exhibit 99.4) |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.27 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Units Agreement, incorporated by reference to Form 8-K of the                Registrant dated March 15, 2006, filed on March 20, 2006. (File No.                000-07258, Exhibit 99.1) |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.28 | Charming                Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted Stock                Agreement - Associates Other Than Section 16 Officers, incorporated                by                reference to Form 10-Q of the Registrant for the quarter ended October                30,                2004 (File No. 000-07258, Exhibit                10.17). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.29 | Charming                Shoppes, Inc. Supplemental Retirement Plan, effective February 1,                2003,                incorporated by reference to Form 10-Q of the Registrant for the                quarter                ended May 3, 2003. (File No. 000-07258, Exhibit                10.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.30 | 2003                Incentive Compensation Plan, incorporated by reference to Appendix                C of                the Registrant’s Proxy Statement Pursuant to Section 14 of the Securities                Exchange Act of 1934, filed on May 22, 2003 (File No.                000-07258). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.31 | Charming                Shoppes Variable Deferred Compensation Plan For Executives, Amended                and                Restated Effective January 1, 2005, incorporated by reference to                Form 8-K                of the Registrant dated December 13, 2005, filed December 16, 2005.                (File                No. 000-07258, Exhibit 99.1). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.32 | Form                of Bonus Agreement by and between Charming Shoppes, Inc. and the                Executive                Officer named in the Agreement, incorporated by reference to Form                10-Q of                the Registrant for the quarter ended October 30, 2004 (File No. 000-07258,                Exhibit 10.14). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.33 | Charming                Shoppes, Inc. Annual Incentive Program As Amended and Restated January                19,                2005, incorporated by reference to Form 8-K of the Registrant dated                January 19, 2005, filed January 25, 2005. (File No. 000-07258, Exhibit                99.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.34 | Charming                Shoppes, Inc. Annual Incentive Program As Amended and Restated February                2,                2006, incorporated by reference to Form 8-K of the Registrant dated                February 2, 2006, filed February 8, 2006. (File No. 000-07258, Exhibit                99.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.35 | Employment                Agreement, dated as of January 1, 2005, by and between Charming Shoppes,                Inc. and Dorrit J. Bern, incorporated by reference to Form 8-K of                the                Registrant dated January 3, 2005, filed on January 4, 2005. (File                No.                000-07258, Exhibit 99.1) |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.36 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Restricted                Stock Agreement, dated as of May 13, 2004, between Charming Shoppes,                Inc.                and Dorrit J. Bern, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended July 31, 2004 (File No. 000-07258,                Exhibit 10.8). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table            of Contents

| 10.2.37 | Charming                Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted Stock                Agreement, dated as of January 3, 2005, between Charming Shoppes,                Inc. and                Dorrit J. Bern, incorporated by reference to Form 10-K of the Registrant                for the fiscal year ended January 29, 2005. (File No. 000-07258,                Exhibit                10.2.37). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.38 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Agreement between Charming Shoppes, Inc. and Dorrit J. Bern,                incorporated by reference to Form 8-K of the Registrant dated February                7,                2005, filed on February 11, 2005. (File No. 000-07258, Exhibit                99.1) |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.39 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Performance                Share Agreement between Charming Shoppes, Inc. and Dorrit J. Bern,                incorporated by reference to Form 8-K of the Registrant dated February                7,                2005, filed on February 11, 2005. (File No. 000-07258, Exhibit                99.3) |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.40 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Units Agreement between Charming Shoppes, Inc. and Dorrit J.                Bern,                incorporated by reference to Form 8-K of the Registrant dated February                2,                2006, filed on February 8, 2006. (File No. 000-07258, Exhibit                99.2) |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.41 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Performance                Share Agreement between Charming Shoppes, Inc. and Dorrit J. Bern,                incorporated by reference to Form 8-K of the Registrant dated February                2,                2006, filed on February 8, 2006. (File No. 000-07258, Exhibit                99.3) |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.42 | Forms                of Executive Severance Agreements by and between Charming Shoppes,                Inc.,                the named executive officers in the company’s Proxy Statement for the                Annual Meeting held on June 15, 2000, and certain other executive                officers                and officers of Charming Shoppes, Inc. and its subsidiaries, incorporated                by reference to Form 10-K of the Registrant for the fiscal year ended                January 29, 2000. (File No. 000-07258, Exhibit                10.2.33). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.43 | Forms                of First Amendment, dated as of February 6, 2003, to Forms of Executive                Severance Agreements, dated July 15, 1999, by and between Charming                Shoppes, Inc., and the executive officers and officers named in the                Agreements, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended February 1, 2003. (File No. 000-07258, Exhibit                10.2.30). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.44 | Form                of Executive Severance Agreement, dated February 6, 2003, by and                between                Charming Shoppes, Inc. and certain executive officers and officers                of                Charming Shoppes, Inc. and its subsidiaries, incorporated by reference                to                Form 10-K of the Registrant for the fiscal year ended February 1,                2003.                (File No. 000-07258, Exhibit                10.2.31). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Other      Exhibits**

| 14 | Charming                Shoppes, Inc. Business Ethics and Standards of Conduct                Policy. |
|----|-------------------------------------------------------------------------------------------------------|

| 21 | Subsidiaries                of Registrant |
|----|-------------------------------------------|

| 23 | Consent                of independent registered public accounting                firm |
|----|----------------------------------------------------------------------------------------|

| 31.1 | Certification                by Principal Executive Officer Pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Certification                by Principal Financial Officer Pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| 32 | Certification                Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table            of Contents

**SIGNATURES**

|                                | **CHARMING                SHOPPES, INC.**            |
|-------------------------------------|------------------------------------------------------|
|                                | (Registrant)                                         |
|                                |                                                 |
|                                |                                                 |
| Date:                April 10, 2006 | **/S/                DORRIT J. BERN**                |
|                                | Dorrit                J. Bern                        |
|                                | Chairman                of the Board                 |
|                                | President                and Chief Executive Officer |

|                                                 |                                        |
|------------------------------------------------------|---------------------------------------------|
| **/S/                DORRIT J. BERN**                | **/S/                ERIC M. SPECTER**      |
| Dorrit                J. Bern                        | Eric                M. Specter              |
| Chairman                of the Board                 | Executive                Vice President     |
| President                and Chief Executive Officer | Chief                Financial Officer      |
| April                10, 2006                        | April                10, 2006               |
|                                                 |                                        |
|                                                 |                                        |
| **/S/                JOHN J. SULLIVAN**              | **/S/                WILLIAM O. ALBERTINI** |
| John                J. Sullivan                      | William                O. Albertini         |
| Vice                President, Corporate Controller  | Director                                    |
| Chief                Accounting Officer              | April                10, 2006               |
| April                10, 2006                        |                                        |
|                                                 |                                        |
|                                                 |                                        |
| **/S/                YVONNE M. CURL**                | **/S/                CHARLES T. HOPKINS**   |
| Yvonne                M. Curl                        | Charles                T. Hopkins           |
| Director                                             | Director                                    |
| April                10, 2006                        | April                10, 2006               |
|                                                 |                                        |
|                                                 |                                        |
| **/S/                KATHERINE M. HUDSON**           | **/S/                PAMELA S. LEWIS**      |
| Katherine                M. Hudson                   | Pamela                S. Lewis              |
| Director                                             | Director                                    |
| April                10, 2006                        | April                10, 2006               |
|                                                 |                                        |
|                                                 |                                        |
| **/S/                MICHAEL W. LUCE**               | **/S/                ALAN ROSSKAMM**        |
| Michael                W. Luce                       | Alan                Rosskamm                |
| Director                                             | Director                                    |
| April                10, 2006                        | April                10, 2006               |

----

Table            of Contents

**Exhibit      Index**

| 2.1 | Covenant                Agreement, dated as of August 16, 2001, between Charming Shoppes,                Inc. and                Limited Brands, Inc., incorporated by reference to Form 8-K of the                Registrant dated August 16, 2001, filed on August 31, 2001. (Exhibit                2.3). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.2 | Master                Sublease, dated as of August 16, 2001, between Limited Brands, Inc.                and                Lane Bryant, Inc., incorporated by reference to Form 8-K of the Registrant                dated August 16, 2001, filed on August 31, 2001. (Exhibit                2.4). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.3 | Stock                Purchase Agreement dated May 19, 2005 by and among Chestnut Acquisition                Sub, Inc., Crosstown Traders, Inc., the Securityholders of Crosstown                Traders, Inc. whose names are set forth on the signature pages thereto                and                J.P. Morgan Partners (BHCA), L.P., as the Sellers’ Representative,                incorporated by reference to Form 8-K of the Registrant dated June                2,                2005, filed on June 8, 2005. (File No. 000-07258, Exhibit                2.1). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.1 | Restated                Articles of Incorporation, incorporated by reference to Form 10-K                of the                Registrant for the fiscal year ended January 29, 1994. (File No.                000-07258, Exhibit 3.1). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2 | By-Laws,                as Amended and Restated, incorporated by reference to Form 10-Q of                the                Registrant for the quarter ended July 31, 1999. (File No. 000-07258,                Exhibit 3.2). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.1 | Amended                and Restated Rights Agreement, dated as of February 1, 2001, between                Charming Shoppes, Inc. and American Stock Transfer & Trust Company, as                Rights Agent, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended February 3, 2001. (File No. 000-07258, Exhibit                4.1). |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.2 | Registration                Agreement, dated as of August 16, 2001, between Charming Shoppes,                Inc. and                Limited Brands, Inc., incorporated by reference to Form 8-K of the                Registrant dated August 16, 2001, filed on August 31, 2001. (File                No.                000-07258, Exhibit 4.1). |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.3 | Indenture,                dated as of May 28, 2002, between Charming Shoppes, Inc. and Wachovia                Bank, National Association, incorporated by reference to Form 10-Q                of the                Registrant for the quarter ended May 4, 2002. (File No. 000-07258,                Exhibit                4.1). |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.4 | Registration                Rights Agreement, dated as of May 28, 2002, by and among Charming                Shoppes,                Inc., as Issuer, and J. P. Morgan Securities, Inc., Bear Stearns&                Co., Inc., First Union Securities, Inc., Lazard Freres & Co., LLC, and                McDonald Investments, Inc., as Initial Purchasers, incorporated by                reference to Form 10-Q of the Registrant for the quarter ended May                4,                2002. (File No. 000-07258, Exhibit                4.2). |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4.5 | Amended                and Restated Loan and Security Agreement, dated as of January 29,                2004, by                and among Charming Shoppes, Inc., Charming Shoppes of Delaware, Inc.,                CSI                Industries, Inc., Catherine Stores Corporation, Lane Bryant, Inc.                and FB                Apparel, Inc., as Borrowers; Charming Shoppes of Delaware, Inc.,                as                Borrowers’ Agent; Congress Financial Corporation, as Administrative Agent,                Collateral Agent, and Joint Bookrunner; J.P. Morgan Business Credit                Corp.,                as Co-Documentation Agent, Joint Lead Arranger, and Joint Bookrunner;                Wachovia Bank, National Association, as Joint Lead Arranger; Bank                of                America, N.A. and Fleet Retail Group, Inc., as Co-Documentation Agents;                and The Financial Institutions named therein, as Lenders, incorporated                by                reference to Form 8-K of the Registrant dated February 4, 2004. (File                No.                000-07258, Exhibit 99.2). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table            of Contents

| 4.6 | Second                Amended and Restated Loan and Security Agreement, dated July 28,                2005, by                and among Charming Shoppes, Inc., Charming Shoppes of Delaware, Inc.,                CSI                Industries, Inc., FB Apparel, Inc., Catherines Stores Corporation,                Lane                Bryant, Inc., and Crosstown Traders, Inc. as borrowers; a syndicate                of                banks and other financial institutions as lenders, including Wachovia                Bank, National Association as agent for the lenders; and certain                of the                Company’s subsidiaries as guarantors, incorporated by reference to Form                8-K of the Registrant dated July 28, 2005, filed on August 3, 2005.                (File                No. 000-07258, Exhibit 10.1).. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.1 | Second                Amended and Restated Pooling and Servicing Agreement, dated as of                November                25, 1997, as amended on July 22, 1999, among Charming Shoppes Receivables                Corp., as Seller, Spirit of America, Inc., as Servicer, and First                Union                National Bank as Trustee, incorporated by reference to Form 8-K of                Charming Shoppes Master Trust and Charming Shoppes Receivables Corp.,                (File No. 333-71757) dated July 22, 1999. (Exhibit No.                4.1). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.2 | Fourth                Amendment, dated as of August 5, 2004, to Second Amended and Restated                Pooling and Servicing Agreement, dated as of November 25, 1997, as                amended                on July 22, 1999 and on May 8, 2001, among Charming Shoppes Receivables                Corp., as Seller, Spirit of America, Inc., as Servicer, and Wachovia                Bank,                National Association (formerly known as First Union National Bank)                as                Trustee, incorporated by reference to Form 10-Q of the Registrant                for the                quarter ended July 31, 2004 (File No. 000-07258, Exhibit                10.4). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.3 | Amendment,                dated as of March 18, 2005, to Second Amended and Restated Pooling                and                Servicing Agreement, dated as of November 25, 1997, as amended on                July 22,                1999, May 8, 2001, and August 5, 2004, among Charming Shoppes Receivables                Corp., as Seller, Spirit of America, Inc., as Servicer, and Wachovia                Bank,                National Association, as Trustee, incorporated by reference to Form                10-K                of the Registrant for the fiscal year ended January 29, 2005. (File                No.                000-07258, Exhibit 10.1.3). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.4 | Series                1999-1 Supplement, dated as of July 22, 1999, to Second Amended and                Restated Pooling and Service Agreement, dated as of November 25,                1997, as                amended on July 22, 1999, among Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and First Union National                Bank, as Trustee, for $150,000,000 Charming Shoppes Master Trust                Asset-Backed Certificates Series 1999-1, incorporated by reference                to Form                8-K of Charming Shoppes Master Trust and Charming Shoppes Receivables                Corp., (File No. 333-71757) dated July 22, 1999. (Exhibit No.                4.2). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.5 | Receivables                Purchase Agreement, dated as of May 28, 1999, among Charming Shoppes                Seller, Inc. as Seller, Spirit of America, Inc., as Servicer, Clipper                Receivables Corporation, as Purchaser, State Street Capital Corporation,                as Administrator, and State Street Bank & Trust Company, as                Relationship Bank, incorporated by reference to Form 10-K of the                Registrant for the fiscal year ended February 2, 2002. (File No.                000-07258, Exhibit 10.1.4). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.6 | Series                1999-2 Supplement, dated as of May 28, 1999, to Second Amended and                Restated Pooling and Service Agreement, dated as of November 25,                1997, as                amended on July 22, 1999, among Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and First Union National                Bank, as Trustee, for $55,750,000 Charming Shoppes Master Trust                Asset-Backed Certificates Series 1999-2, incorporated by reference                to Form                10-K of the Registrant for the fiscal year ended January 29, 2000.                (File                No. 000-07258, Exhibit 10.1.23). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table            of Contents

| 10.1.7 | Series                2000-VFC Supplement, dated as of November 9, 2000, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997,                among Charming Shoppes Receivables Corp., as Seller, Spirit of America,                Inc., as Servicer, and First Union National Bank, as Trustee, on                behalf of                the Series 2000-VFC Certificateholders, for up to $60,122,700 Charming                Shoppes Master Trust Series 2000-VFC, incorporated by reference to                Form                10-K of the Registrant for the fiscal year ended February 3, 2001.                (File                No. 000-07258, Exhibit 10.1.16). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.8 | Certificate                Purchase Agreement, dated as of November 9, 2000, among Charming                Shoppes                Receivables Corp. as Seller and as the Class B Purchaser, Spirit                of                America, Inc. as Servicer, Monte Rosa Capital Corporation as the                Conduit                Purchaser, and ING Baring (U.S.) Capital Markets LLC as Administrator                for                the Conduit Purchaser, incorporated by reference to Form 10-K of                the                Registrant for the fiscal year ended February 3, 2001. (File No.                000-07258, Exhibit 10.1.17). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.9 | Purchase                Agreement dated as of March 14, 2005 between Citibank USA, N.A.,                Spirit of                America National Bank and Catherines, Inc., incorporated by reference                to                Form 8-K of the Registrant dated March 18, 2005, filed on March 22,                2005.                (File No. 000-07258, Exhibit 99). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.10 | Credit                Card Processing Agreement, among World Financial Network National                Bank,                Lane Bryant, Inc., and Sierra Nevada Factoring, Inc., dated as of                January                31, 1996, incorporated by reference to Form 10-K of the Registrant                for the                fiscal year ended February 2, 2002. (File No. 000-07258, Exhibit                10.1.9). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.11 | Amendment                to Credit Card Processing Agreement, among World Financial Network                National Bank, Lane Bryant, Inc., and Sierra Nevada Factoring, Inc.,                dated                as of January 28, 2005, incorporated by reference to Form 10-K of                the                Registrant for the fiscal year ended January 29, 2005. (File No.                000-07258, Exhibit 10.1.12). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.12 | Purchase                and Sale Agreement, among Spirit of America National Bank, as Seller,                and                Charming Shoppes Receivables Corp., as Purchaser, dated as of November                25,                1997, incorporated by reference to Form S-1/A of Charming Shoppes                Receivables Corp. (File No. 333-71757) (Exhibit 10.1(a)). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.13 | First                Amendment to Purchase and Sale Agreement, among Spirit of America                National                Bank, as Seller, and Charming Shoppes Receivables Corp., as Purchaser,                dated as of July 22, 1999, incorporated by reference to Form 8-K                of                Charming Shoppes Receivables Corp. (File No. 333-71757) (Exhibit                10.1). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.14 | Series                2002-1 Supplement, dated as of November 20, 2002, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997, as                amended on July 22, 1999 and on May 8, 2001, among Charming Shoppes                Receivables Corp., as Seller, Spirit of America, Inc., as Servicer,                and                Wachovia Bank, National Association, as Trustee, for $100,000,000                Charming                Shoppes Master Trust Asset-Backed Certificates Series 2002-1, incorporated                by reference to Form 10-Q of the Registrant for the quarter ended                November                2, 2002. (File No. 000-07258, Exhibit                10.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.15 | Charming                Shoppes Master Trust $63,500,000 Fixed Rate Class A Asset Backed                Certificates, Series 2002-1 and $16,500,000 Fixed Rate Class B Asset                Backed Certificates, Series 2002-1 Certificate Purchase Agreement,                dated                as of November 22, 2002, incorporated by reference to Form 10-Q of                the                Registrant for the quarter ended November 2, 2002. (File No. 000-07258,                Exhibit 10.2). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.16 | Certificate                Purchase Agreement, dated as of November 22, 2002, among Wachovia                Bank,                National Association, as Trustee, Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and The Class C Holders                described therein, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended November 2, 2002. (File No. 000-07258,                Exhibit 10.3). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table            of Contents

| 10.1.17 | Certificate                Purchase Agreement, dated as of November 22, 2002, among Wachovia                Bank,                National Association, as Trustee, Charming Shoppes Receivables Corp.,                as                Seller, Spirit of America, Inc., as Servicer, and The Class D Holders                described therein, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended November 2, 2002. (File No. 000-07258,                Exhibit 10.4). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.18 | $14,000,000                Promissory Note, dated October 2002, between White Marsh Distribution,                LLC., as Borrower, and General Electric Capital Business Asset Funding                Corporation, as Payee and Holder, incorporated by reference to Form                10-Q                of the Registrant for the quarter ended November 2, 2002. (File No.                000-07258, Exhibit 10.5). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.19 | Commercial                Deed of Trust, Security Agreement, Assignment of Leases and Rents,                and                Fixture Filing, made as of October 2002, among the Grantor, White                Marsh                Distribution, LLC, as Borrower, in favor of James M. Smith, as Trustee,                for the benefit of the Beneficiary, General Electric Capital Business                Asset Funding Corporation, as Lender, incorporated by reference to                Form                10-Q of the Registrant for the quarter ended November 2, 2002. (File                No.                000-07258, Exhibit 10.6). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.20 | Certificate                Purchase Agreement, dated as of January 21, 2004, among Charming                Shoppes                Receivables Corp., as Seller and as the Class B Purchaser, Spirit                of                America, Inc., as Servicer, Sheffield Receivables Corporation, as                the                Conduit Purchaser, and Barclay’s Bank PLC as Administrator for the Conduit                Purchaser, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended January 31, 2004. (File No. 000-07258, Exhibit                10.1.17). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.21 | Series                2004-VFC Supplement, dated as of January 21, 2004, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997 and                amended as of July 22, 1999 and as of May 8, 2001, among Charming                Shoppes                Receivables Corp., as Seller, Spirit of America, Inc., as Servicer,                and                Wachovia Bank, National Association, as Trustee on behalf of the                Series                2004-VFC Certificateholders, for up to $132,000,000 Charming Shoppes                Master Trust Asset-Backed Certificates Series 2004-VFC, incorporated                by                reference to Form 10-K of the Registrant for the fiscal year ended                January                31, 2004. (File No. 000-07258, Exhibit                10.1.18). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.22 | Series                2004-1 Supplement, dated as of August 5, 2004, to Second Amended                and                Restated Pooling and Service Agreement, dated as of November 25,                1997 (as                amended on July 22, 1999, on May 8, 2001 and on August 5, 2004),                among                Charming Shoppes Receivables Corp., as Seller, Spirit of America,                Inc., as                Servicer, and Wachovia Bank, National Association, as Trustee, on                behalf                of the Series 2004-1 Certificateholders, for $180,000,000 Charming                Shoppes                Master Trust Series 2004-1, incorporated by reference to Form 10-Q                of the                Registrant for the quarter ended July 31, 2004 (File No. 000-07258,                Exhibit 10.5). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.23 | Certificate                Purchase Agreement, dated as of July 21, 2004, among Charming Shoppes                Receivables Corp., Fashion Service Corp., Spirit of America, Inc.,                and                Barclay’s Capital Inc. (as representative of the Initial Purchasers),                incorporated by reference to Form 10-Q of the Registrant for the                quarter                ended July 31, 2004 (File No. 000-07258, Exhibit                10.6). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.24 | Certificate                Purchase Agreement, dated as of August 5, 2004, among Wachovia Bank,                National Association as Trustee, Charming Shoppes Receivables Corp.                as                Seller, Spirit of America, Inc. as Servicer, and Clipper Receivables                Company LLC as Initial Class C Holder, incorporated by reference                to Form                10-Q of the Registrant for the quarter ended July 31, 2004 (File                No.                000-07258, Exhibit 10.7). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.1.25 | Mortgage,                Assignment of Leases and Rents and Security Agreement, dated as of                October                6, 2004, between FB Distro Distribution Center, LLC, as Mortgagor,                and                BankAtlantic Commercial Mortgage Capital, LLC, as Mortgagee, incorporated                by reference to Form 10-Q of the Registrant for the quarter ended                October                30, 2004 (File No. 000-07258, Exhibit                10.9). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.26 | $13,000,000                Mortgage Note, dated October 6, 2004, between FB Distro Distribution                Center, LLC, as Maker, and BankAtlantic Commercial Mortgage Capital,                LLC,                as Payee, incorporated by reference to Form 10-Q of the Registrant                for the                quarter ended October 30, 2004 (File No. 000-07258, Exhibit                10.10). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.27 | Guaranty,                executed as of October 6, 2004, by Charming Shoppes, Inc., as Guarantor,                for the benefit of BankAtlantic Commercial Mortgage Capital, LLC,                as                Lender, incorporated by reference to Form 10-Q of the Registrant                for the                quarter ended October 30, 2004 (File No. 000-07258, Exhibit                10.11). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.28 | Hazardous                Substances Indemnity Agreement, dated October 6, 2004, by FB Distro                Distribution Center, LLC and by Charming Shoppes, Inc., jointly and                severally as Indemnitors, in favor of BankAtlantic Commercial Mortgage                Capital, LLC, as Holder, incorporated by reference to Form 10-Q of                the                Registrant for the quarter ended October 30, 2004 (File No. 000-07258,                Exhibit 10.12). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.29 | Amended                and Restated Class D Certificate Purchase Agreement, dated as of                August                25, 2004, among Wachovia Bank, National Association as Trustee, Charming                Shoppes Receivables Corp. as Seller and as Initial Class D-1 Holder,                Spirit of America, Inc. as Servicer, and Clipper Receivables Company                LLC,                as the Class D-1 Holder, incorporated by reference to Form 8-K of                the                Registrant dated August 24, 2004, filed on August 27, 2004. (File                No.                000-07258, Exhibit 99.1). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1.30 | Amended                and Restated Certificate Purchase Agreement, dated as of November                22, 2004                and Amended and Restated as of November 18, 2004, among Wachovia                Bank,                National Association as Trustee, Charming Shoppes Receivables Corp.                as                Seller, Spirit of America, Inc. as Servicer, and the Class D-2                Certificateholders Described Herein, incorporated by reference to                Form                10-Q of the Registrant for the quarter ended October 30, 2004 (File                No.                000-07258, Exhibit 10.13). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.1 | The                1988 Key Employee Stock Option Plan of Charming Shoppes, Inc., as                amended                and restated January 25, 2006. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.2 | Form                of Charming Shoppes, Inc. 1988 Key Employee Stock Option Plan Key                Employee                Stock Option Agreement. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.3 | The                1989 Non-Employee Director Stock Option Plan of Charming Shoppes,                Inc., as                amended, incorporated by reference to Form 10-K of the Registrant                for the                fiscal year ended January 30, 1993. (File No. 000-07258, Exhibit                10.2.5). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.4 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program,                incorporated by reference to Registration Statement on Form S-8 of                the                Registrant, dated February 25, 1997. (Registration No. 333-22323,                Exhibit                4.1). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.2.5 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program,                As                Amended and Restated, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended July 31, 1999. (File No. 000-07258,                Exhibit 10.1). |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.6 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program,                As                Amended and Restated at June 27, 2002, incorporated by reference                to Form                10-K of the Registrant for the fiscal year ended February 1, 2003.                (File                No. 000-07258, Exhibit 10.2.6). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.7 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program                Stock                Option Agreement, incorporated by reference to Form 10-Q of the Registrant                for the quarter ended July 31, 1999. (File No. 000-07258, Exhibit                10.2). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.8 | The                Charming Shoppes, Inc. Non-Employee Directors Compensation Program                Restricted Stock Agreement, incorporated by reference to Form 10-Q                of the                Registrant for the quarter ended July 31, 1999. (File No. 000-07258,                Exhibit 10.3). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.9 | Form                of Charming Shoppes, Inc. 2003 Non-Employee Directors Compensation                Plan                Stock Option Agreement, incorporated by reference to Form 8-K of                the                Registrant dated June 23, 2005, filed on June 29, 2005. (File No.                000-07258, Exhibit 10.1). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.10 | Form                of Charming Shoppes, Inc. 2003 Non-Employee Directors Compensation                Plan                Restricted Share Units Agreement, incorporated by reference to Form                8-K of                the Registrant dated June 23, 2005, filed on June 29, 2005. (File                No.                000-07258, Exhibit 10.2). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.11 | The                1993 Employees’ Stock Incentive Plan of Charming Shoppes, Inc.,                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended January 29, 1994. (File No. 000-07258, Exhibit                10.2.10). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.12 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Restricted                Stock Agreement, dated as of February 11, 2002, incorporated by reference                to Form 10-K of the Registrant for the fiscal year ended February                2, 2002.                (File No. 000-07258, Exhibit                10.2.8). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.13 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Stock Option                Agreement (regular vesting schedule), incorporated by reference to                Form                10-K of the Registrant for the fiscal year ended February 2, 2002.                (File                No. 000-07258, Exhibit 10.2.20). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.14 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Stock Option                Agreement (accelerated vesting schedule), incorporated by reference                to                Form 10-K of the Registrant for the fiscal year ended February 2,                2002.                (File No. 000-07258, Exhibit                10.2.21). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.15 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan                Performance-Accelerated Stock Option Agreement, incorporated by reference                to Form 10-K of the Registrant for the fiscal year ended February                2, 2002.                (File No. 000-07258, Exhibit                10.2.22). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.16 | The                Charming Shoppes, Inc. Employee Stock Purchase Plan, as amended,                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended February 3, 1996. (File No. 000-07258, Exhibit                10.2.10). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.17 | The                Charming Shoppes Inc. 1999 Associates’ Stock Incentive Plan, incorporated                by reference to Form 10-K of the Registrant for the fiscal year ended                January 30, 1999. (File No. 000-07258, Exhibit                10.2.24). |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.2.18 | Charming                Shoppes, Inc. 1999 Associates’ Stock Incentive Plan Stock Option                Agreement, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended January 30, 1999. (File No. 000-07258, Exhibit                10.2.25). |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.19 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan, incorporated by reference to Form 10-K of the Registrant                for the fiscal year ended February 3, 2001. (File No. 000-07258,                Exhibit                10.2.29). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.20 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan Stock Option Agreement (regular vesting schedule)                ,                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended February 2, 2002. (File No. 000-07258, Exhibit                10.2.23). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.21 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan Stock Option Agreement (accelerated vesting schedule),                incorporated by reference to Form 10-K of the Registrant for the                fiscal                year ended February 2, 2002. (File No. 000-07258, Exhibit                10.2.24). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.22 | The                Charming Shoppes, Inc. Amended and Restated 2000 Associates’ Stock                Incentive Plan Restricted Stock Agreement, incorporated by reference                to                Form 10-K of the Registrant for the fiscal year ended February 2,                2002.                (File No. 000-07258, Exhibit                10.2.25). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.23 | 2004                Stock Award and Incentive Plan, incorporated by reference to Appendix                B of                the Registrant’s Proxy Statement Pursuant to Section 14 of the Securities                Exchange Act of 1934, filed on May 19,                2004. |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.24 | Charming                Shoppes, Inc. 2004 Stock Award and Incentive Plan Stock Option Agreement,                incorporated by reference to Form 10-Q of the Registrant for the                quarter                ended October 30, 2004 (File No. 000-07258, Exhibit                10.15). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.25 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Agreement - Section 16 Officers, incorporated by reference                to Form                8-K of the Registrant dated February 7, 2005, filed on February 11,                2005.                (File No. 000-07258, Exhibit 99.2) |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.26 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Performance                Share Agreement, incorporated by reference to Form 8-K of the Registrant                dated February 7, 2005, filed on February 11, 2005. (File No. 000-07258,                Exhibit 99.4) |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.27 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Units Agreement, incorporated by reference to Form 8-K of the                Registrant dated March 15, 2006, filed on March 20, 2006. (File No.                000-07258, Exhibit 99.1) |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.28 | Charming                Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted Stock                Agreement - Associates Other Than Section 16 Officers, incorporated                by                reference to Form 10-Q of the Registrant for the quarter ended October                30,                2004 (File No. 000-07258, Exhibit                10.17). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.29 | Charming                Shoppes, Inc. Supplemental Retirement Plan, effective February 1,                2003,                incorporated by reference to Form 10-Q of the Registrant for the                quarter                ended May 3, 2003. (File No. 000-07258, Exhibit                10.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.30 | 2003                Incentive Compensation Plan, incorporated by reference to Appendix                C of                the Registrant’s Proxy Statement Pursuant to Section 14 of the Securities                Exchange Act of 1934, filed on May 22, 2003 (File No.                000-07258). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.2.31 | Charming                Shoppes Variable Deferred Compensation Plan For Executives, Amended                and                Restated Effective January 1, 2005, incorporated by reference to                Form 8-K                of the Registrant dated December 13, 2005, filed December 16, 2005.                (File                No. 000-07258, Exhibit 99.1). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.32 | Form                of Bonus Agreement by and between Charming Shoppes, Inc. and the                Executive                Officer named in the Agreement, incorporated by reference to Form                10-Q of                the Registrant for the quarter ended October 30, 2004 (File No. 000-07258,                Exhibit 10.14). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.33 | Charming                Shoppes, Inc. Annual Incentive Program As Amended and Restated January                19,                2005, incorporated by reference to Form 8-K of the Registrant dated                January 19, 2005, filed January 25, 2005. (File No. 000-07258, Exhibit                99.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.34 | Charming                Shoppes, Inc. Annual Incentive Program As Amended and Restated February                2,                2006, incorporated by reference to Form 8-K of the Registrant dated                February 2, 2006, filed February 8, 2006. (File No. 000-07258, Exhibit                99.1). |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.35 | Employment                Agreement, dated as of January 1, 2005, by and between Charming Shoppes,                Inc. and Dorrit J. Bern, incorporated by reference to Form 8-K of                the                Registrant dated January 3, 2005, filed on January 4, 2005. (File                No.                000-07258, Exhibit 99.1) |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.36 | The                Charming Shoppes, Inc. 1993 Employees’ Stock Incentive Plan Restricted                Stock Agreement, dated as of May 13, 2004, between Charming Shoppes,                Inc.                and Dorrit J. Bern, incorporated by reference to Form 10-Q of the                Registrant for the quarter ended July 31, 2004 (File No. 000-07258,                Exhibit 10.8). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.37 | Charming                Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted Stock                Agreement, dated as of January 3, 2005, between Charming Shoppes,                Inc. and                Dorrit J. Bern, incorporated by reference to Form 10-K of the Registrant                for the fiscal year ended January 29, 2005. (File No. 000-07258,                Exhibit                10.2.37). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.38 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Agreement between Charming Shoppes, Inc. and Dorrit J. Bern,                incorporated by reference to Form 8-K of the Registrant dated February                7,                2005, filed on February 11, 2005. (File No. 000-07258, Exhibit                99.1) |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.39 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Performance                Share Agreement between Charming Shoppes, Inc. and Dorrit J. Bern,                incorporated by reference to Form 8-K of the Registrant dated February                7,                2005, filed on February 11, 2005. (File No. 000-07258, Exhibit                99.3) |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.40 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Restricted                Stock Units Agreement between Charming Shoppes, Inc. and Dorrit J.                Bern,                incorporated by reference to Form 8-K of the Registrant dated February                2,                2006, filed on February 8, 2006. (File No. 000-07258, Exhibit                99.2) |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.41 | Form                of Charming Shoppes, Inc. 2004 Stock Award and Incentive Plan Performance                Share Agreement between Charming Shoppes, Inc. and Dorrit J. Bern,                incorporated by reference to Form 8-K of the Registrant dated February                2,                2006, filed on February 8, 2006. (File No. 000-07258, Exhibit                99.3) |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.42 | Forms                of Executive Severance Agreements by and between Charming Shoppes,                Inc.,                the named executive officers in the company’s Proxy Statement for the                Annual Meeting held on June 15, 2000, and certain other executive                officers                and officers of Charming Shoppes, Inc. and its subsidiaries, incorporated                by reference to Form 10-K of the Registrant for the fiscal year ended                January 29, 2000. (File No. 000-07258, Exhibit                10.2.33). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.2.43 | Forms                of First Amendment, dated as of February 6, 2003, to Forms of Executive                Severance Agreements, dated July 15, 1999, by and between Charming                Shoppes, Inc., and the executive officers and officers named in the                Agreements, incorporated by reference to Form 10-K of the Registrant                for                the fiscal year ended February 1, 2003. (File No. 000-07258, Exhibit                10.2.30). |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.44 | Form                of Executive Severance Agreement, dated February 6, 2003, by and                between                Charming Shoppes, Inc. and certain executive officers and officers                of                Charming Shoppes, Inc. and its subsidiaries, incorporated by reference                to                Form 10-K of the Registrant for the fiscal year ended February 1,                2003.                (File No. 000-07258, Exhibit                10.2.31). |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14 | Charming                Shoppes, Inc. Business Ethics and Standards of Conduct                Policy. |
|----|-------------------------------------------------------------------------------------------------------|

| 21 | Subsidiaries                of Registrant |
|----|-------------------------------------------|

| 23 | Consent                of independent registered public accounting                firm |
|----|----------------------------------------------------------------------------------------|

| 31.1 | Certification                by Principal Executive Officer Pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Certification                by Principal Financial Officer Pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002. |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| 32 | Certification                Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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