8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 23, 2009

THE BON-TON STORES, INC.
(Exact name of registrant as specified in its charter)

Pennsylvania	0-19517	23-2835229
(State or other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2801 E. Market Street, York, Pennsylvania	17402
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: 717-757-7660

Not Applicable

(Former name or former address if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) Compensatory Arrangements of Certain Officers

Employment Agreement with Anthony Buccina

On January 28, 2009, The Bon-Ton Stores, Inc. (the “Company”) issued a press release announcing the signing, on January 23, 2009, of an Employment Agreement (the “Employment Agreement”), Restricted Stock Agreement and Restricted Stock Agreement – Performance Shares (collectively, the “Restricted Stock Agreements”) with Anthony Buccina, the Company’s Vice Chairman, President – Merchandising.

The description of the material terms of the Employment Agreement set forth below is qualified in its entirety by the Employment Agreement and Restricted Stock Agreements, which are attached to this Current Report on Form 8-K as Exhibits 10.1, 10.2 and 10.3, respectively, and incorporated herein by reference. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Mr. Buccina’s Employment Agreement follows an employment agreement dated June 1, 2006 that expires January 31, 2009. The new Employment Agreement is effective as of February 1, 2009 and will terminate on April 30, 2011, unless sooner terminated in accordance with the terms of the Employment Agreement. Unless terminated, the Employment Agreement shall renew for successive one-year terms beginning May 1^st of each year.

The Employment Agreement provides that Mr. Buccina’s title is Vice Chairman, President – Merchandising of the Company and he will report to the Company’s Chief Executive Officer. In addition, Mr. Buccina will be a member of the Company’s Management Committee and Operating Committee.

Mr. Buccina’s initial base salary under the Employment Agreement is $791,800 per year. This base salary is subject to review during the term of the Employment Agreement and may be increased in the sole discretion of the Company, upon approval of the Company’s Human Resources and Compensation Committee of the Board of Directors (“HRCC”).

The Employment Agreement provides that Mr. Buccina is eligible for a bonus under The Bon-Ton Stores, Inc. Cash Bonus Plan under the following parameters: a target bonus of 100% of base salary in effect on the last day of the relevant fiscal year, with threshold and maximum bonuses as determined by the HRCC. The performance measures to be utilized and the weighting of these performance measures will be determined by the Company’s HRCC consistent with its determinations for other senior executives under the Cash Bonus Plan.

The Employment Agreement provides that Mr. Buccina will receive a grant of 100,000 restricted shares of the Company’s common stock pursuant to the terms of the Company’s 2000 Stock Incentive and Performance-Based Award Plan. Such restricted shares shall vest on April 30, 2011, provided that Mr. Buccina is still employed by the Company on such date. In addition, Mr. Buccina will receive, as performance-based compensation, a grant of 50,000 restricted shares of the Company’s common stock for each of Fiscal Year 2009 and Fiscal Year 2010. The metrics for earning such performance-based shares shall be determined each year by the HRCC. The terms of the grants are set forth in the Restricted Stock Agreements.

Mr. Buccina is eligible to participate in plans and programs that are generally made available to the other employees of the Company. Mr. Buccina is currently a participant in the Carson Pirie Scott & Company Supplemental Executive Retirement Plan (“SERP”), which was recently terminated by the Company. The Employment Agreement provides that the Company will pay to Mr. Buccina in 2009 the net present value of his interest in the SERP, which is estimated to be in the range of $2.8 million to $3.0 million. The Employment Agreement further provides that the Company will pay the reasonable legal fees, up to $5,000, incurred by Mr. Buccina in connection with the negotiation of the Employment Agreement. The allowances for automobile and medical benefits currently provided in the existing employment agreement are not continued under the Employment Agreement.

In the event of discharge without cause or resignation for good reason during the initial term of the Employment Agreement ending April 30, 2011 or during the first renewal term ending April 30, 2012 or the Company has not offered to renew the Employment Agreement for the first renewal term ending April 30, 2012, Mr. Buccina will be entitled to receive severance pay equal to the greater of his base pay for the remaining contract term or two times his base salary, payable in a lump sum as soon as practicable following the six month anniversary of the termination of Mr. Buccina’s employment. The severance payment is contingent on Mr. Buccina signing and not timely revoking a general release of claims.

Upon a “Change of Control” (as such term defined in the Employment Agreement), (1) the vesting of stock options and restricted shares held by Mr. Buccina shall be governed by the terms of such stock options or restricted shares and (2) Mr. Buccina is prohibited from resigning for good reason for a period of six months following the Change of Control. If following a Change of Control he is discharged without cause or resigns for good reason within two years of the Change of Control, Mr. Buccina will receive a severance payment equal to two times his average base pay for the most recently completed three years plus two times the average bonus paid to him for the most recently completed three years. The Change of Control severance payment is contingent on Mr. Buccina signing and not timely revoking a general release of claims.

Mr. Buccina’s Employment Agreement contains a non-competition clause that, during Mr. Buccina’s employment and for a period equal to one-half of the period for which he receives severance payments after termination of his employment, prohibits Mr. Buccina from engaging in or being financially interested in the retail department stores business of any competitor of the Company named in the Employment Agreement. Mr. Buccina’s Employment Agreement also contains confidentiality provisions relating to the Company’s confidential information.

Employment Agreement with Stephen Byers

On January 28, 2009, The Bon-Ton Stores, Inc. (the “Company”) issued a press release announcing the signing, on January 23, 2009, of an Employment Agreement (the “Employment Agreement”), Restricted Stock Agreement and Restricted Stock Agreement – Performance Shares (collectively, the “Restricted Stock Agreements”) with Stephen Byers, the Company’s Vice Chairman, Stores, Visual, Construction, Real Estate, Distribution & Logistics, Loss Prevention.

The description of the material terms of the Employment Agreement set forth below is qualified in its entirety by the Employment Agreement and Restricted Stock Agreements, which are attached to this Current Report on Form 8-K as Exhibits 10.4, 10.5 and 10.6, respectively, and incorporated herein by reference. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
     
Mr. Byers’s Employment Agreement follows an employment agreement dated June 28, 2006, as amended by the first amendment to the employment agreement dated December 20, 2006, that expires January 31, 2009. The new Employment Agreement is effective as of February 1, 2009 and will terminate on April 30, 2011, unless sooner terminated in accordance with the terms of the Employment Agreement. Unless terminated, the Employment Agreement shall renew for successive one-year terms beginning May 1^st of each year.
     
The Employment Agreement provides that Mr. Byers’s title is Vice Chairman, Stores, Visual, Construction, Real Estate, Distribution & Logistics, Loss Prevention and he will report to the Company’s Chief Executive Officer. In addition, Mr. Byers will be a member of the Company’s Management Committee and Operating Committee.
     
Mr. Byers’s initial base salary under the Employment Agreement is $533,500 per year. This base salary is subject to review during the term of the Employment Agreement and may be increased in the sole discretion of the Company, upon approval of the Company’s Human Resources and Compensation Committee of the Board of Directors (“HRCC”).   
   
The Employment Agreement provides that Mr. Byers is eligible for a bonus under The Bon-Ton Stores, Inc. Cash Bonus Plan under the following parameters: a target bonus of 100% of base salary in effect on the last day of the relevant fiscal year, with threshold and maximum bonuses as determined by the HRCC. The performance measures to be utilized and the weighting of these performance measures will be determined by the Company’s HRCC consistent with its determinations for other senior executives under the Cash Bonus Plan.
     
The Employment Agreement provides that Mr. Byers will receive a grant of 70,000 restricted shares of the Company’s common stock pursuant to the terms of the Company’s 2000 Stock Incentive and Performance-Based Award Plan. Such restricted shares shall vest on April 30, 2011, provided that Mr. Byers is still employed by the Company on such date. In addition, Mr. Byers will receive, as performance-based compensation, a grant of 35,000 restricted shares of the Company’s common stock for each of Fiscal Year 2009 and Fiscal Year 2010. The metrics for earning such performance-based shares shall be determined each year by the HRCC. The terms of the grants are set forth in the Restricted Stock Agreements.
     
Mr. Byers is eligible to participate in plans and programs that are generally made available to the other employees of the Company. The Employment Agreement further provides that the Company will pay the reasonable legal fees, up to $5,000, incurred by Mr. Byers in connection with the negotiation of the Employment Agreement. The allowances for automobile and medical benefits currently provided in the existing employment agreement are not continued under the Employment Agreement.

In the event of discharge without cause or resignation for good reason during the initial term of the Employment Agreement ending April 30, 2011, Mr. Byers will be entitled to receive severance pay equal to the greater of his base pay for the remaining contract term or two times his base salary, payable in a lump sum as soon as practicable following the six month anniversary of the termination of Mr. Byers’s employment. The severance payment is contingent on Mr. Byers signing and not timely revoking a general release of claims.
     
Upon a “Change of Control” (as such term defined in the Employment Agreement), (1) the vesting of stock options and restricted shares held by Mr. Byers shall be governed by the terms of such stock options or restricted shares and (2) Mr. Byers is prohibited from resigning for good reason for a period of six months following the Change of Control. If following a Change of Control he is discharged without cause or resigns for good reason within two years of the Change of Control, Mr. Byers will receive a severance payment equal to two times his average base pay for the most recently completed three years plus two times the average bonus paid to him for the most recently completed three years. The Change of Control severance payment is contingent on Mr. Byers signing and not timely revoking a general release of claims.

Mr. Byers’s Employment Agreement contains a non-competition clause that, during Mr. Byers’s employment and for a period equal to one-half of the period for which he receives severance payments after termination of his employment, prohibits Mr. Byers from engaging in or being financially interested in the retail department stores business of any competitor of the Company named in the Employment Agreement. Mr. Byers’s Employment Agreement also contains confidentiality provisions relating to the Company’s confidential information.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit Number	Description of Exhibit
10.1	Employment Agreement with Anthony Buccina
10.2	Restricted Stock Agreement with Anthony Buccina
10.3	Restricted Stock Agreement – Performance Shares with Anthony Buccina
10.4	Employment Agreement with Stephen Byers
10.5	Restricted Stock Agreement with Stephen Byers
10.6	Restricted Stock Agreement – Performance Shares with Stephen Byers
99.1	Press Release issued January 28, 2009 regarding Employment Agreements with Anthony Buccina and Stephen Byers

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

The Bon-Ton Stores, Inc.

By: /s/ Keith E. Plowman                          
Keith E. Plowman
Executive Vice President, Chief Financial
Officer and Principal Accounting Officer

Dated: January 28, 2009

EXHIBIT INDEX

Exhibit Number	Description of Exhibit
10.1	Employment Agreement with Anthony Buccina
10.2	Restricted Stock Agreement with Anthony Buccina
10.3	Restricted Stock Agreement – Performance Shares with Anthony Buccina
10.4	Employment Agreement with Stephen Byers
10.5	Restricted Stock Agreement with Stephen Byers
10.6	Restricted Stock Agreement – Performance Shares with Stephen Byers
99.1	Press Release issued January 28, 2009 regarding Employment Agreements with Anthony Buccina and Stephen Byers

EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT (“Agreement”) is by and between THE BON-TON STORES, INC., a Pennsylvania corporation (the “Company”), and ANTHONY BUCCINA (the “Employee”) as of the 1^st day of February, 2009.

W I T N E S S E T H:

WHEREAS, Employee is currently party to an Employment Agreement dated June 1, 2006, the term of which expires January 31, 2009 (the “Prior Employment Agreement”); and

WHEREAS, the Company and Employee have agreed upon terms upon which Employee will continue his employment with the Company.

NOW THEREFORE, in consideration of the mutual promises and covenants contained herein and intending to be legally bound hereby, the Company and Employee agree as follows:

1. Position and Responsibilities.

(a) The Company hereby employs Employee and Employee hereby accepts continued employment by the Company as the Company’s Vice Chairman, President — Merchandising. Employee will perform duties as determined by the Chief Executive Officer of the Company. Employee shall report directly to the Chief Executive Officer or such other senior executive officer of the Company designated by the Chief Executive Officer or the person performing the duties of the Chief Executive Officer. In addition, Employee shall be a member of the Management Committee and the Operating Committee.

(b) Throughout the term of this Agreement, Employee shall devote his entire working time, energy, attention, skill and best efforts to the affairs of the Company and to the performance of his duties hereunder in a manner that will faithfully and diligently further the business and interests of the Company. Approval of board memberships and participation in lectures and teaching activities will be at the discretion of the Chief Executive Officer; however, such approval will not be unreasonably withheld, provided that such activities do not significantly interfere with Employee’s duties under this Agreement. Employee shall comply with the Company’s Code of Ethical Standards and Business Practices.

2. Term and Renewal. This Agreement shall become effective on February 1, 2009, provided that this Agreement has been signed by Employee and the Company and these terms approved by the Human Resources and the Compensation Committee (“HRCC”) of the Company’s Board of Directors. The initial term shall continue through April 30, 2011, unless sooner terminated in accordance with paragraph 10 below (the “Initial Term”). Unless terminated by either party not later than the last Friday in January preceding the termination date of the Agreement, this Agreement shall renew for successive one-year terms beginning May 1^st of each such year.

3. Place of Performance. Employee shall be based at the office of the Company in Milwaukee, Wisconsin, except for travel required for Company business.

4. Compensation.

(a) Salary. Employee shall receive a base salary (the “Base Salary”) at the annual rate of $791,800, effective February 1, 2009. This Base Salary, less taxes and normal deductions, shall be paid to Employee in substantially equal installments in accordance with the Company’s regular executive payroll practices in effect from time to time. The Base Salary may be reviewed from time to time, but no less than annually, during the term of this Agreement by the Chief Executive Officer (subject to review by the HRCC) to ascertain whether, in the Company’s sole discretion, such Base Salary should be increased, and once increased, such Base Salary shall not be decreased. The first such salary review shall occur for Fiscal Year 2009 consistent with the Company’s practice for such year for similar senior executives.

(b) Restricted Shares. On February 2, 2009, Employee will be granted 100,000 restricted shares of the Company’s Common Stock (“Restricted Shares”) pursuant to the terms of the 2000 Stock Incentive and Performance-Based Award Plan (the “SIP”). Employee’s ownership of the Restricted Shares will vest on April 30, 2011, provided he is still employed on such date.

(c) Performance Based Compensation.

(i) Annual Bonus.

A. For the Company’s Fiscal Year 2009 and thereafter, Employee shall be eligible for a bonus under the Cash Bonus Plan (the “Annual Bonus”) with the following parameters: a target bonus of 100% of Employee’s Base Salary in effect on the last day of the relevant fiscal year; a threshold bonus and a maximum bonus shall be as determined from time to time by the Company consistent with other similar senior executives under the Cash Bonus Plan. The performance measures and weighting of these performance measures shall be determined by the HRCC consistent with its determinations for other senior executives under the Cash Bonus Plan.

B. Nothing herein is a guarantee that any Annual Bonus will be paid.

C. To the extent reasonably practicable, the Annual Bonus shall be computed within 90 days following the close of the Company’s fiscal year and paid within 30 days of its computation. Employee must be employed on the last day of the Company’s fiscal year to receive an Annual Bonus with respect to that fiscal year.

2

(ii) Performance-Based Award of Restricted Shares. Employee will be eligible to receive 50,000 restricted shares of the Company’s Common Stock as a performance-based award for Fiscal Year 2009 and 50,000 restricted shares of the Company’s Common Stock as a performance-based award for Fiscal Year 2010 as set forth in a Stock Agreement entered into pursuant to the terms of the SIP.

5. Allowances. The Company will reimburse employee on a one-time basis for reasonable attorneys fees expended in review and negotiation of this Agreement, up to a maximum of $5,000.

6. Medical Insurance. During the term of his employment, Employee and his eligible dependents shall be eligible to participate in the Company’s group medical, dental and vision plans (the “Health Plans”) in accordance with the terms of the Health Plans and, subject to the restrictions and limitations contained in the insurance agreement or agreements. In the event employment is terminated and Employee receives severance benefits, Employee and his eligible dependents shall continue to participate in the Health Plans in which Employee is enrolled at the time of termination, subject to the restrictions and limitations contained in the insurance agreement or agreements. Employee’s eligibility shall be for the greater of the remaining term or two years. The Company shall pay the company contribution for such Health Plans, and Employee shall pay the associate portion of Health Plan costs, as in effect at such time.

7. Other Benefits. Employee shall be eligible to participate in the Company’s profit sharing plan, deferred compensation plan, discount program, vacation plan, long-term disability plan and employee benefit programs generally made available to other employees of the Company, subject to their respective generally applicable eligibility requirements, terms, conditions and restrictions; provided, however, that severance payments under this Agreement shall be in lieu of any severance benefits otherwise provided by the Company. However, nothing in this Agreement shall preclude the Company from amending or terminating any such insurance, benefit, program or plan so long as the amendment or termination is applicable to the Company’s executives participating in such insurance, benefit, program or plan generally. Moreover, the Company’s obligations under this provision shall not apply to any insurance, benefit, program or plan made available on an individual basis to one or more select executive employees by contract if such insurance, benefit, program or plan is not made available to all executive employees. With respect to Employee’s participation in the Company’s vacation plan, Employee shall be eligible for four weeks vacation per calendar year, which vacation entitlement shall be pro-rated in any calendar year in which Employee does not work the entire calendar year.

3

8. Supplemental Executive Retirement Plan. Employee is a participant in the Carson Pirie Scott & Company Supplemental Executive Retirement Plan (the “SERP”). The Company and the Employee agree that the SERP shall pay to Employee, net of required withholding and deductions, a single sum distribution of the present value of his accrued benefit based on the net present value of such accrued benefit as of February 1, 2009. Payment shall be made on a date selected by the Company as soon as practical after February 15, 2009, in order to permit the Company to obtain the January 2009 interest rate assumption and for the Company’s actuaries to make the necessary computations. The provisions of this paragraph are intended to be an election as to the time and manner of payment of a nonqualified deferred compensation benefit consistent with the transitional rules contained in proposed Treasury Regulations promulgated pursuant to Internal Revenue Code (“Code”) Section 409A.

9. Business Expenses. The Company shall pay or reimburse Employee for reasonable entertainment and other expenses incurred by Employee in connection with the performance of Employee’s duties under this Agreement upon receipt of vouchers therefor and in accordance with the Company’s regular reimbursement procedures and practices in effect from time to time.

10. Termination of Employment. Notwithstanding any other provision of this Agreement, Employee’s employment and all of the Company’s obligations or liabilities under this Agreement may be terminated immediately, excluding any obligations the Company may have under paragraph 11 below, in any of the following circumstances:

(a) Disability or Incapacity. In the event of Employee’s physical or mental inability to perform his essential duties hereunder, with or without reasonable accommodation, for a period of 13 consecutive weeks or for a cumulative period of 26 weeks during the term of this Agreement.

(b) Death of Employee. In the event of Employee’s death.

(c) Resignation for Good Reason. Employee may resign for “Good Reason,” defined below, upon 30 days’ written notice by Employee to the Company except as set forth in paragraph 10(d) below. The Company may waive Employee’s obligation to work during this 30-day notice period and terminate his employment immediately, but if the Company takes this action in the absence of agreement by Employee, Employee shall receive the salary that otherwise would be due through the end of the notice period. For purposes of this Agreement, “Good Reason” shall mean any of the following violations of this Agreement by the Company: any reduction in Employee’s Base Salary; except as provided in this Agreement, any reduction in Employee’s potential bonus target percentage amounts; any relocation of Employee from Milwaukee, Wisconsin; and any substantial breach by the Company of any material provision of this Agreement. Notwithstanding the foregoing, the acts or omissions described above shall not constitute “Good Reason” unless Employee provides the Company with written notice detailing the matters he asserts to be “Good Reason” which the Company does not cure within thirty (30) days of receiving the written notice.

4

(d) Change of Control. In the event of a Change of Control of the Company, provided the Company or Surviving Company (as defined below) continues to pay Employee his Base Salary and provide materially comparable benefits, Employee shall be prohibited from resigning for Good Reason for a period of six months following the Change of Control. For purposes of this Agreement, a Change of Control shall be deemed to occur if:

(i) any person who is not an affiliate of the Company on the date hereof becomes a beneficial owner of a majority of the outstanding voting power of the Company’s capital stock;

(ii) the shareholders of the Company approve and there is consummated any plan of liquidation providing for the distribution of all or substantially all of the Company’s assets;

(iii) there is consummated a merger, consolidation or other form of business combination involving the Company, or, in one transaction or a series of related transactions, a sale of all or substantially all of the assets of the Company, unless, in any such case:

(A) the business of the Company is continued following such transaction by a resulting entity (which may be, but need not be, the Company) (the “Surviving Company”); and

(B) persons who were the beneficial owners of a majority of the outstanding voting power of the Company immediately prior to the completion of such transaction beneficially own, by reason of such prior beneficial ownership, a majority of the outstanding voting power of the Surviving Company (or a majority of the outstanding voting power of the direct or indirect parent of the Surviving Company, as the case may be) immediately following the completion of such transaction; or

(iv) any person beneficially owns shares of the Company’s capital stock possessing a greater voting power than held in the aggregate by M. Thomas Grumbacher, any member of his family, any trust for the primary benefit of M. Thomas Grumbacher or any member of his family, and any charitable foundation of which M. Thomas Grumbacher is a founder or co-founder with his wife (collectively, the “Grumbacher Affiliates”), or if the Grumbacher Affiliates control less than twenty percent (20%) of the outstanding voting power of the Company’s capital stock.

For purposes of this definition, the terms “person,” “beneficial owner,” “beneficial ownership,” “affiliate” and “control” shall have the meanings ascribed to such terms under Sections 13(d) and 3(a)(9) and Rule 13d-3 under the Securities Exchange Act of 1934 as amended, and Rule 501 under the Securities Act of 1933 as amended, as applicable.

(e) Discharge for Cause. The Company may discharge Employee at any time for “Cause,” which shall be limited to: Employee’s material and serious breach or neglect of Employee’s responsibilities; willful violation or disregard of standards of conduct established by law; willful violation or disregard of standards of conduct established by Company policy as may from time to time be communicated to Employee; fraud, willful misconduct, misappropriation of funds or other dishonesty; conviction of a crime of moral turpitude; any misrepresentation made in this Agreement; or any material breach by Employee of any provision of this Agreement (including, without limitation, acceptance of employment with another company or performing work or providing advice to another company, as an employee, consultant or in any other similar capacity while still an employee of the Company).

5

(f) Discharge without Cause. Notwithstanding any other provision of this Agreement, Employee’s employment and any and all of the Company’s obligations under this Agreement (excluding any obligations the Company may have under paragraph 11 below) may be terminated by the Company at any time without Cause.

11. Payments Upon Termination.

(a) Discharge Without Cause, Resignation for Good Reason, or End of Term. If Employee is discharged without Cause or resigns for Good Reason during the Initial Term or the first one-year renewal term ending April 30, 2012, or the Initial Term is not renewed for an additional one year term ending April 30, 2012, Employee shall receive severance pay equal to the greater of (i) his Base Salary for the remaining term of this Agreement or (ii) two times his then Base Salary. The severance payment shall be payable in a lump sum as soon as practicable following the six (6) month anniversary of Employee’s termination of employment. The severance payment will be made provided that Employee signs and does not timely revoke a general release of claims (including, without limitation, contractual, common law and statutory claims) against the Company and its officers, directors, employees and agents. This severance payment shall be in lieu of any other severance payment to which Employee is entitled by reason of the Prior Employment Agreement or any severance plan sponsored by Saks, Inc. or the Company. Employee will also receive any vested benefits to which Employee is entitled under the Company’s stock options and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in these plans.

(b) Death or Disability/Incapacity.

(i) Upon death, Employee’s estate’s sole entitlement will be to Base Salary for any days worked prior to his death, amounts payable on account of Employee’s death under any insurance or benefit plans or policies maintained by the Company, and any vested benefits to which Employee is entitled under the Company’s stock option and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in those plans.

(ii) On termination for disability or incapacity, Employee’s sole entitlement will be to Base Salary for any days worked prior to the date of termination, amounts payable on account of disability or incapacity under any insurance or benefit plans or policies maintained and any vested benefits to which Employee is entitled under the Company’s stock option and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in those plans.

(c) Discharge for Cause. If Employee is discharged for Cause or resigns without Good Reason, Employee’s sole entitlement will be the receipt of Base Salary for any days worked through the date of termination and any vested benefits to which Employee is entitled under the Company’s stock option and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in those plans.

6

(d) Change of Control.

(i) Upon a Change of Control as defined in paragraph 10(d) while Employee is employed pursuant to this Agreement, if Employee is discharged without Cause or resigns for Good Reason within two years of the consummation of the Change of Control, Employee shall receive severance pay equal to (i) two times the average Base Salary paid to Employee for the most recently completed three W-2 years prior to discharge or resignation and (ii) two times the average Annual Bonus paid for the most recently completed three W-2 years prior to discharge or resignation. The severance payment shall be payable in a lump sum as soon as practicable following the six (6) month anniversary of Employee’s termination of employment. The severance payment will be made provided that Employee signs and does not timely revoke a general release of claims (including, without limitation, contractual, common law and statutory claims) against the Company and its officers, directors, employees and agents. This severance payment shall be in lieu of any other severance payment to which Employee is entitled by reason of the Prior Employment Agreement or any severance plan sponsored by Saks, Inc. or the Company.

(ii) Upon a Change of Control as defined in paragraph 10(d) while Employee is employed pursuant to this Agreement, the vesting of stock options and Restricted Shares held by Employee shall be governed by the terms of such stock options or Restricted Shares.

(iii) Notwithstanding any other provision of this Agreement, if the aggregate present value of the “parachute payments” to the Employee, determined under Section 280G(b) of the Internal Revenue Code of 1986, as amended (the “Code”), would be at least three times the “base amount” determined under Code Section 280G, then the “280G Permitted Payment” shall be the maximum benefit that may be realized upon a Change of Control under this Section 11(d) such that the aggregate present value of such “parachute payments” to Employee is less than three times his “base amount.” In addition, in the event the aggregate present value of the parachute payments to Employee would be at least three times his base amount even after a reduction of the Change of Control benefits to $0 (all as determined for purposes of Code Section 280G), compensation otherwise payable under this Agreement and any other amount payable hereunder or any other severance plan, program, policy or obligation of the Company or any other affiliate thereof that would constitute “parachute payments” shall be reduced so that the aggregate present value of all “parachute payments” to Employee, as determined under Code Section 280G(b) is less than three times his base amount. Any decisions regarding the requirement or implementation of such reductions shall be made by such tax counsel as may be selected by the Company and acceptable to Employee.

7

12. Company Property. All advertising, sales, manufacturers’ and other materials or articles or information, including, without limitation, data processing reports, customer sales analyses, invoices, price lists or information or any other materials or data of any kind furnished to Employee by the Company or developed by Employee on behalf of the Company or at the Company’s direction or for the Company’s use or otherwise in connection with Employee’s employment with the Company, are and shall remain the sole and confidential property of the Company.

13. Non-Competition and Confidentiality. To the maximum extent permissible by law:

(a) During his employment with the Company and for a period of one year after the termination of his employment with the Company for any reason whatsoever, whether by Employee or by the Company and whether during the term of this Agreement or subsequent to the expiration of this Agreement, Employee shall not, directly or indirectly induce or intentionally influence any customer, employee, consultant, independent contractor or supplier of the Company to change his, her or its business relationship with or terminate employment with the Company.

(b) During his employment with the Company and after the termination of his employment with the Company for any reason whatsoever, whether by Employee or by the Company and whether during the term of this Agreement or subsequent to the expiration of this Agreement for a period equal to one-half of the period for which the Employee receives severance payments according to paragraph 11(a), Employee shall not engage in (as a principal, partner, director, officer, agent, employee, consultant, owner, independent contractor or otherwise) or be financially interested in the retail department store business of any Competitor of the Company. For purposes of this Agreement, a Competitor means each of Federated Department Stores, Dillard’s Inc., Kohl’s Corporation, Belk, Inc. and J.C. Penney, Inc. or the affiliates and successors of each of them.

(c) During his employment with the Company and at all times thereafter, and except as required by law, Employee shall not use for his personal benefit, or disclose, communicate or divulge to, or use for the direct or indirect benefit of, any person, firm, association or company other than the Company, any confidential information of the Company that Employee acquires in the course of his employment, which is not otherwise lawfully known by and readily available to the general public. This confidential information includes, but is not limited to: any material referred to in paragraph 12 or any non-public information regarding the business, marketing, legal or accounting methods, policies, plans, procedures, strategies or techniques; research or development projects or results; trade secrets or other knowledge or processes of or developed by the Company; names and addresses of employees, suppliers or customers. Employee confirms that such information is confidential and constitutes the exclusive property of the Company, and agrees that, immediately upon his termination, whether by Employee or by the Company and whether during the term of this Agreement or subsequent to the expiration of this Agreement, Employee shall deliver to the Company all correspondence, documents, books, records, lists, computer programs and other writings relating to the Company’s business; and Employee shall retain no copies, regardless of where or by whom said writings were kept or prepared.

8

(d) Both during his employment with the Company and following his termination for any reason, whether by Employee or by the Company and whether during the term of this Agreement or following the expiration of the Agreement, Employee shall, upon reasonable notice, furnish to the Company such information pertaining to his employment with the Company as may be in his possession. The Company shall reimburse Employee for all reasonable expenses incurred by him in fulfilling his obligation under this subparagraph (d).

(e) The provisions of subparagraphs (a), (b), (c) and (d) shall survive the cessation of Employee’s employment for any reason, as well as the expiration of this Agreement at the end of its term or at any time prior thereto.

(f) Employee acknowledges that the restrictions contained in this paragraph 13, in view of the nature of the business in which the Company is engaged and the Employee’s position with the Company, are reasonable and necessary to protect the legitimate interests of the Company, and that any violation of those restrictions would result in irreparable injury to the Company. Employee therefore agrees that, in the event of his violation of any of those restrictions, the Company shall be entitled to obtain from any court of competent jurisdiction preliminary and permanent injunctive relief against Employee, in addition to damages from Employee and an equitable accounting of all commissions, earnings, profits and other benefits arising from such violation, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled.

(g) Employee agrees that if any or any portion of the foregoing covenants, or the application thereof, is construed to be invalid or unenforceable, the remainder of such covenant or covenants or the application thereof shall not be affected and the remaining covenant or covenants will then be given full force and effect without regard to the invalid or unenforceable portions. If any covenant is held to be unenforceable because of the area covered, the duration thereof, or the scope thereof, Employee agrees that the Court making such determination shall have the power to reduce the area and/or the duration, and/or limit the scope thereof, and the covenant shall then be enforceable in its reduced form. If Employee violates any of the restrictions contained in subparagraphs (a) or (b), the period of such violation (from the commencement of any such violation until such time as such violation shall be cured by Employee to the satisfaction of the Company) shall not count toward or be included in the restrictive period contained in subparagraphs (a) and (b).

(h) For purposes of paragraphs 12 and 13 of this Agreement, the term “Company” shall include not only The Bon-Ton Stores, Inc., but also any of its successors, assigns, subsidiaries or affiliates. Employee consents to the assignment of this Agreement to any purchaser of the Company or a substantial portion of its assets.

9

14. Other Tax Matters.

(a) Employee agrees that he is responsible for paying any and all federal, state and local income taxes assessed with respect to any money, benefits or other consideration received from the Company and that the Company is entitled to withhold any tax payments from amounts otherwise due Employee to the extent required by applicable statutes, rulings or regulations.

(b) Compliance With Code Section 409A.

(i) Notwithstanding anything to the contrary herein, no payment otherwise required to be made hereunder that the Company determines constitutes a payment of nonqualified deferred compensation for purposes of Section 409A of the Code shall be paid to Employee at a time or in a manner that will be treated as a violation of the distribution rules of Code Section 409A(a)(2) and no alternative form of payment of such amount(s) shall be permitted to be made hereunder if such alternative benefit form would violate any of the requirements of Code Section 409A(a)(3) or (4) relating to acceleration of benefits and changes in time and form of distribution (taking into account any regulations or other guidance issued by Treasury or the Internal Revenue Service with regard to these Code provisions as may be in effect from time to time).

(ii) The intent of this provision is to ensure that no additional tax liabilities are imposed on any payments or benefits provided hereunder pursuant to Code Section 409A, and may require, for example, a delay in commencement of payments until six months after Employee’s termination of employment with the Company. In the event any payment is delayed by reason of this paragraph 14, such payment shall, when made, be increased by an amount representing “interest” from the date payment would otherwise have been made, through the date payment is actually made, calculated using the Company’s cost of borrowing as the interest rate, as determined by the Company at its discretion.

15. Prior Agreements.

(a) Employee represents that there are no restrictions, agreements or understandings whatsoever to which Employee is a party that could impact upon his employment under this Agreement or that would prevent or make unlawful his execution of this Agreement or his employment hereunder.

(b) Employee agrees that he will not use or disclose any confidential or proprietary information of any of his prior employers during the course of his employment under this Agreement.

16. Entire Understanding. This Agreement contains the entire understanding between the Company and Employee with respect to the subject matter hereof and supersedes all prior and contemporary agreements and understandings, inducements or conditions, express or implied, written or oral, between the Company and Employee except as herein contained. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof.

10

17. Modifications. This Agreement may not be modified orally but only by written agreement signed by Employee and the Company’s Chief Executive Officer or such other person as the Board may designate specifically for this purpose.

18. Provisions Separable. The provisions of this Agreement are independent of and separable from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue of the fact that for any reason any other or others of them may be invalid or unenforceable in whole or in part.

19. Consolidation, Merger or Sale of Assets. Nothing in this Agreement shall preclude the Company from consolidating or merging into or with, or transferring all or substantially all of its assets to, another entity that assumes this Agreement and all obligations and undertakings of the Company hereunder. Under such a consolidation, merger or transfer of assets and assumption, the term “the Company” as used herein, shall mean such other entity and this Agreement shall continue in full force and effect.

20. Notices. All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given, made and received when delivered (personally, by courier service such as UPS or by messenger) or when deposited in the United States mails, registered or certified mail, postage pre-paid, return receipt requested, addressed as set forth below:

(a)	If to the Company:
	The Bon-Ton Stores, Inc. 331 W. Wisconsin Avenue Milwaukee, WI 53203 Attention: Chief Executive Officer
	with a copy to:
	The Bon-Ton Stores, Inc. 2801 East Market Street York, PA 17402 Attention: General Counsel
(b)	If to Employee:
	Anthony Buccina 1963 W. Hidden Reserve Court Mequon, WI 53092

11

In addition, notice by mail shall be by air mail or courier if posted outside of the continental United States. Any party may alter the address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions of this paragraph for the giving of notice.

21. No Attachment. Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation or to execution, attachment, levy or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

22. Binding Agreement. This Agreement shall be binding upon, and shall inure to the benefit of the Company and its successors, representatives, and assigns and shall be binding upon Employee, his heirs, executors and legal representatives.

23. No Assignment by Employee. Employee acknowledges that the services to be rendered by him are unique and personal. Accordingly, Employee may not assign or delegate any of his rights or obligations hereunder, except that he may assign certain rights hereunder if agreed to in writing by the Chief Executive Officer.

24. Indulgences. Neither the failure nor any delay on the part of either party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

25. Paragraph Headings. The paragraph headings in this Agreement are for convenience only; they form no part of this Agreement and shall not affect its interpretation.

26. Controlling Law. This Agreement and all questions relating to its validity, interpretation, performance and enforcement (including, without limitation, provisions concerning limitations of actions), shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania, notwithstanding any conflict-of-laws doctrines of such state or any other jurisdiction to the contrary, and without the aid of any canon, custom or rule of law requiring construction against the draftsman.

27. Chief Executive Officer. In the absence of the Chief Executive Officer, the decisions of the Chief Executive Officer may be made by such other person as designated by the Company’s Board.

28. Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties hereto.

12

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have duly executed and delivered, in Pennsylvania, this Agreement as of the date first above written.

THE BON-TON STORES, INC.
By:	/s/ Byron L. Bergren
	Byron L. Bergren
	President and Chief Executive Officer
EMPLOYEE:
/s/ Anthony Buccina
Anthony Buccina

13

EX-10.2

Exhibit 10.2

THE BON-TON STORES, INC.

RESTRICTED STOCK AGREEMENT

This is a Restricted Stock Agreement dated as of February 2, 2009 (“Agreement”), between The Bon-Ton Stores, Inc. (the “Company”) and the undersigned (“Grantee”). This Agreement is entered into pursuant to the provisions of the Plan (as defined below) and in connection with a certain employment agreement entered into by and between the Grantee and the Company as of February 1, 2009, (the employment agreement, including all amendments thereto being referred to herein as the “Employment Agreement”). This Agreement is intended to be consistent with the Employment Agreement and specifically those provisions of the Employment Agreement regarding the grant of “Restricted Shares,” and shall be so interpreted. To the extent any provision hereof is inconsistent with the provisions of the Employment Agreement, the provisions of the Employment Agreement shall be given effect. To the extent the definition of any terms defined in the Employment Agreement is modified from time to time by amendments made to the Employment Agreement, the definition as in effect at the relevant time shall apply for purposes of this Agreement.

1. Definitions. As used herein:

(a) “Date of Grant” means February 2, 2009, the date on which the Company awarded the Restricted Stock.

(b) “Forfeiture Date” means any date as of which Grantee’s rights to all or any portion of the Restricted Stock are forfeited pursuant to applicable provisions of this Agreement.

(c) “Plan” means The Bon-Ton Stores, Inc. Amended and Restated 2000 Stock Incentive and Performance-Based Award Plan, as amended from time to time.

(d) “Restricted Period” with respect to any shares of Restricted Stock means the period beginning on the Date of Grant and ending on the Vesting Date for such shares.

(e) “Vesting Date” with respect to any shares of Restricted stock means the date set as a vesting date pursuant to Paragraph 2 hereof, or such earlier vesting date as is otherwise provided herein.

All other capitalized terms used herein shall have the meaning set forth in the Employment Agreement or in the Plan except to the extent the context clearly requires otherwise. This Agreement is intended to be consistent with the terms of the Plan and is subject in all regards to the terms of the Plan. In the event of any inconsistency in the definition contained in the Employment Agreement and that contained in the Plan, the definition in the Employment Agreement shall control.

2. Grant of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, the Company grants to Grantee one hundred thousand (100,000) shares of the Company’s Common Stock, par value $.01 (the “Restricted Stock”). All of the Restricted Stock shall vest on April 30, 2011, provided that, on such applicable Vesting Date, Grantee is, and has continuously been, an employee of the Company or an Affiliate of the Company during such shares’ Restricted Period. In lieu of vesting of the Restricted Stock on the Vesting Dates noted above, the Restricted Stock shall become fully vested: (i) if Grantee’s employment is terminated by the Company without Cause (as that term is defined in the Employment Agreement) or if the Grantee resigns from his employment with the Company or an Affiliate of the Company for Good Reason (as that term is defined in the Employment Agreement), provided Grantee executes a general release as required under applicable provisions of the Employment Agreement; or (ii) in accordance with Paragraph 8 below in the event of a Change of Control of the Company.

3. Restrictions on Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, Grantee shall not be permitted to sell, transfer, pledge or assign any Restricted Stock during such shares’ Restricted Period.

4. Lapse of Restrictions. Subject to the terms and conditions set forth herein and in the Plan, the restrictions on Restricted Stock set forth in Paragraph 3 shall lapse on the Vesting Date.

5. Forfeiture of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, if Grantee’s employment with the Company or an Affiliate of the Company terminates during the Restricted Period for any reason, such date shall be the Forfeiture Date, and Grantee shall forfeit any Restricted Stock still subject to restrictions as of the Forfeiture Date; provided, however, that any shares required to be vested pursuant to the Employment Agreement by reason of the Grantee’s termination of employment (i.e., discharge by the Company without Cause or resignation for Good Reason, provided Grantee executes a general release as required under applicable provisions of the Employment Agreement), shall be treated as vested as of such termination of employment and no Forfeiture Date shall be applicable to Grantee’s Restricted Stock under such circumstances. Upon a forfeiture of any shares of Restricted Stock as provided in this Paragraph 5, the shares of Restricted Stock so forfeited shall be reacquired by the Company without consideration as of the Forfeiture Date.

6. Rights of Grantee. Except for the restrictions set forth in Paragraph 3, during the Restricted Period Grantee shall have all of the rights of a shareholder with respect to the Restricted Stock, including the right to vote the Restricted Stock to the same extent that such shares could be voted if they were not subject to the restrictions set forth in this Agreement.

7. Dividends on Restricted Stock. Any cash dividends payable with respect to the Restricted Stock during the Restricted Period shall be paid to Grantee. Any extraordinary dividends or dividends that are in the nature of a distribution of shares or are otherwise equivalent to a stock split, shall be subject to the same restrictions as apply to the Restricted Stock with respect to which such extraordinary dividends or shares were issued and shall be forfeited in accordance with Paragraph 5 unless the restrictions lapse in accordance with Paragraph 4.

2

8. Change of Control of Company. In the event of a Change of Control (as defined, from time to time, in the Employment Agreement), the Restricted Stock shall immediately become fully vested.

9. Notices. Any notice to be given to the Company shall be addressed to the Controller of the Company at its principal executive office, and any notice to be given to Grantee shall be addressed to Grantee at the address then appearing on the personnel records of the Company or the Affiliate of the Company by which he or she is employed, or at such other address as either party hereafter may designate in writing to the other. Any such notice shall be deemed to have been duly given when personally delivered, by courier service such as Federal Express, or by other messenger, or when deposited in the United States mail, addressed as aforesaid, registered or certified mail, and with proper postage and registration or certification fees prepaid.

10. Securities Laws. The Committee may from time to time impose any conditions on the Restricted Stock as it deems necessary or advisable to ensure that all rights granted under the Plan satisfy the conditions of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of 1934, as amended.

11. Delivery of Shares. Upon a Vesting Date, the Company shall notify Grantee (or Grantee’s personal representative, heir or legatee in the event of Grantee’s death) that the restrictions on an installment of Restricted Stock have lapsed, and shall, without payment from Grantee for such Restricted Stock, upon such Grantee’s request deliver a certificate for such Restricted Stock without any legend or restrictions, except for such restrictions as may be imposed by the Committee, in its sole judgment, under Paragraph 10, provided that no certificates for shares will be delivered to Grantee (or to his or her personal representative, heir or legatee) until appropriate arrangements have been made with the Company for the withholding of any taxes which may be due with respect to such shares. The Company may condition delivery of certificates for shares upon the prior receipt from Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with federal and state securities laws. The right to payment of any fractional shares shall be satisfied in cash, measured by the product of the fractional amount times the Fair Market Value of a share on the Vesting Date.

12. Status of Restricted Stock. The Restricted Stock is intended to constitute property that is subject to a substantial risk of forfeiture during the Restricted Period, and subject to federal income tax in accordance with section 83 of the Internal Revenue Code (the “Code”). Section 83 generally provides that Grantee will recognize compensation income with respect to each installment of the Restricted Stock on the Vesting Date in an amount equal to the then fair market value of the shares for which restrictions have lapsed. Alternatively, Grantee may elect, pursuant to Section 83(b) of the Code, to recognize compensation income for all or any part of the Restricted Stock at the Date of Grant in an amount equal to the fair market value of the Restricted Stock subject to the election on the Date of Grant. Such election must be made within 30 days of the Date of Grant and Grantee shall immediately notify the Company if such an election is made. Grantee should consult his or her tax advisors to determine whether a Section 83(b) election is appropriate.

3

13. Administration. This Award has been granted pursuant to and is subject to the terms and provisions of the Plan. All questions of interpretation and application of the Plan and this Award shall be determined by the Committee. The Committee’s determination shall be final, binding and conclusive.

14. Award Not to Affect Employment. Nothing herein contained shall affect the right of the Company or any Affiliate to terminate Grantee’s employment, services, responsibilities, duties, or authority to represent the Company or any Affiliate at any time for any reason whatsoever.

15. Withholding of Taxes. Whenever the Company proposes or is required to deliver or transfer shares in connection with this Award, the Company shall have the right to (a) require Grantee to remit to the Company an amount sufficient to satisfy any federal, state and/or local withholding tax requirements prior to the delivery or transfer of any certificate or certificates for such shares or (b) take whatever action it deems necessary to protect its interest with respect to tax liabilities. In addition, Grantee shall have the right to have such withholding tax requirements satisfied, either in whole or in part, by means of a relinquishment back to, the Company of a number of shares as to which Grantee’s interest is fully vested having a Fair Market Value equal to the amount of such withholding tax requirements as Grantee indicates he wants to meet by such means.

16. Governing Law. The validity, performance, construction and effect of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without giving effect to principles of conflicts of law.

17. Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter, except that the Employment Agreement shall control in the event of any inconsistencies between this Agreement and the Employment Agreement.

4

IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement as of the day and year first above written.

THE BON-TON STORES, INC.
By:	/s/ Byron L. Bergren
	Byron L. Bergren
	President and Chief Executive Officer
/s/ Anthony Buccina
Anthony Buccina

5

EX-10.3

Exhibit 10.3

THE BON-TON STORES, INC.

RESTRICTED STOCK AGREEMENT
PERFORMANCE SHARES

This is a Restricted Stock Agreement — Performance Shares dated as of February 2, 2009 (“Agreement”), between The Bon-Ton Stores, Inc. (the “Company”) and the undersigned (“Grantee”). This Agreement is entered into pursuant to the provisions of the Plan (as defined below) and in connection with a certain employment agreement entered into by and between the Grantee and the Company as of February 1, 2009, (the employment agreement, including all amendments thereto being referred to herein as the “Employment Agreement”). This Agreement is intended to be consistent with the Employment Agreement and specifically those provisions of the Employment Agreement regarding “Performance-Based Award of Restricted Shares” and shall be so interpreted. To the extent any provision hereof is inconsistent with the provisions of the Employment Agreement, the provisions of the Employment Agreement shall be given effect. To the extent the definition of any terms defined in the Employment Agreement is modified from time to time by amendments made to the Employment Agreement, the definition as in effect at the relevant time shall apply for purposes of this Agreement. All determinations regarding the vesting of Restricted Stock hereunder shall be made by the Committee (as that term is defined in the Plan) consistent with the Plan’s provisions regarding performance-based compensation.

1. Definitions. As used herein:

(a) “Date of Grant” means February 2, 2009, the date on which the Company awarded the Restricted Stock.

(b) “Forfeiture Date” means any date as of which Grantee’s rights to all or any portion of the Restricted Stock are forfeited pursuant to applicable provisions of this Agreement.

(c) “Plan” means The Bon-Ton Stores, Inc. Amended and Restated 2000 Stock Incentive and Performance-Based Award Plan, as amended from time to time.

(d) “Restricted Period” with respect to any shares of Restricted Stock means the period beginning on the Date of Grant and ending on the Vesting Date for such shares.

(e) “Vesting Date” with respect to any shares of Restricted stock means the date set as a vesting date pursuant to Paragraph 2 hereof, or such earlier vesting date as is otherwise provided herein.

All other capitalized terms used herein shall have the meaning set forth in the Employment Agreement or in the Plan except to the extent the context clearly requires otherwise. This Agreement is intended to be consistent with the terms of the Plan and is subject in all regards to the terms of the Plan. In the event of any inconsistency in the definition contained in the Employment Agreement and that contained in the Plan, the definition in the Employment Agreement shall control.

2. Grant of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, the Company grants to Grantee one hundred thousand (100,000) shares of the Company’s Common Stock, par value $.01 (the “Restricted Stock”). Of the Restricted Stock subject to this Agreement, fifty percent (50%) is subject to vesting (or forfeiture) on the basis of the achievement of certain performance goals to be established for the Company’s 2009 fiscal year (i.e., the fiscal year ending January 30, 2010), and the remaining fifty percent (50%) is subject to vesting (or forfeiture) on the basis of the achievement of performance goals to be established for the Company’s 2010 fiscal year (i.e., the fiscal year ending January 29, 2011). The two portions of the Restricted Stock are referred to herein as the “2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009” and the “2009 Performance Shares Based Upon Company Performance for Fiscal Year 2010,” respectively. Except as otherwise provided herein, the Restricted Stock shall vest (or be forfeited) as follows:

2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009

One hundred percent (100%) of the fifty thousand (50,000) 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009 become vested in the event the Company achieves the target financial objectives set by the Committee for Fiscal Year 2009. The Committee may also establish vesting for less than one hundred percent of such shares based on achievement of financial objectives below the target financial objective.

2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010

One hundred percent (100%) of the fifty thousand (50,000) 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 become vested in the event the Company achieves the target financial objectives set by the Committee for Fiscal Year 2010. The Committee may also establish vesting for less than one hundred percent of such shares based on achievement of financial objectives below the target financial objective.

Termination of Employment. Any Restricted Stock that is not earned and vested on the effective date of the Grantee’s termination of employment for any reason shall be forfeited (if not already forfeited), subject to the following:

(i) In the event that the Grantee, on or before January 30, 2010 is discharged without Cause or resigns for Good Reason, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009 shall become vested to the extent provided above based on attainment of the performance goals for the Company’s 2009 fiscal year to the same extent such Restricted Stock would have become vested had the Grantee remained employed with the Company or an Affiliate of the Company through the date that the Committee makes a determination regarding the achievement of the performance targets described above for the Company’s 2009 fiscal year; provided, however, that no portion of the 2009 Performance Shares Based Upon Company Performance for Fiscal Year 2009 shall be vested in such a situation unless the Grantee executes a general release as required under applicable provisions of the Employment Agreement; and

2

(ii) In the event that the Grantee, after January 30, 2010 and prior to January 30, 2011, is discharged without Cause or resigns for Good Reason, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 shall become vested to the same extent such Restricted Stock would have become vested had the Grantee remained employed with the Company or an Affiliate of the Company through the date that the Committee makes a determination regarding the achievement of the performance goals established for the Company’s 2010 fiscal year; provided, however, that no portion of the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 shall be vested in such a situation unless the Grantee executes a general release of claims consistent with the release of claims as required under applicable provisions of the Employment Agreement.

3. Restrictions on Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, Grantee shall not be permitted to sell, transfer, pledge or assign any Restricted Stock during such shares’ Restricted Period.

4. Lapse of Restrictions. Subject to the terms and conditions set forth herein and in the Plan, the restrictions on Restricted Stock set forth in Paragraph 4 shall lapse on the Vesting Date.

5. Forfeiture Dates and Forfeiture of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan: If Grantee’s employment with the Company or an Affiliate of the Company terminates during the Restricted Period for any reason, such date shall be the Forfeiture Date, and Grantee shall forfeit any Restricted Stock still subject to restrictions as of the Forfeiture Date, except as provided above in Paragraph 2. Upon a forfeiture of any shares of Restricted Stock as provided in this Paragraph 5, the shares of Restricted Stock so forfeited shall be reacquired by the Company without consideration.

6. Rights of Grantee. Except for the restrictions set forth in Paragraph 3 and the provisions respecting dividends on Restricted Stock set forth in Paragraph 7, during the Restricted Period Grantee shall have all of the rights of a shareholder with respect to the Restricted Stock, including the right to vote the Restricted Stock to the same extent that such shares could be voted if they were not subject to the restrictions set forth in this Agreement.

7. Dividends on Restricted Stock. No dividends shall accrue or be paid to the Grantee with respect to any shares of Restricted Stock for any period prior to the date such shares become vested.

8. Change of Control of Company. In the event of a Change of Control (as defined, from time to time, in the Employment Agreement) prior to January 30, 2010, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009 shall immediately become fully vested. In the event of a Change of Control on or after January 30, 2010 and on or before January 29, 2011, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 shall become vested without regard to the achievement of the goals established for the Company’s 2010 fiscal year on the third month anniversary of the date of the Change of Control, provided the Grantee remains employed by the Company or an Affiliate of the Company or, if applicable, a successor company, through such date, or on such earlier date following the Change of Control if the Grantee is terminated by the Company or an Affiliate of the Company or, if applicable, a successor company, without Cause.

3

9. Notices. Any notice to be given to the Company shall be addressed to the Controller of the Company at its principal executive office, and any notice to be given to Grantee shall be addressed to Grantee at the address then appearing on the personnel records of the Company or the Affiliate of the Company by which he or she is employed, or at such other address as either party hereafter may designate in writing to the other. Any such notice shall be deemed to have been duly given when personally delivered, by courier service such as Federal Express, or by other messenger, or when deposited in the United States mail, addressed as aforesaid, registered or certified mail, and with proper postage and registration or certification fees prepaid.

10. Securities Laws. The Committee may from time to time impose any conditions on the Restricted Stock as it deems necessary or advisable to ensure that all rights granted under the Plan satisfy the conditions of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of 1934, as amended.

11. Delivery of Shares. Upon the determination that any portion of the Restricted Stock has become vested, the Company shall notify Grantee (or Grantee’s personal representative, heir or legatee in the event of Grantee’s death) that the restrictions on an installment of Restricted Stock have lapsed, and shall, without payment from Grantee for such Restricted Stock, upon such Grantee’s request deliver a certificate for such Restricted Stock without any legend or restrictions, except for such restrictions as may be imposed by the Committee, in its sole judgment, under Paragraph 10, provided that no certificates for shares will be delivered to Grantee (or to his or her personal representative, heir or legatee) until appropriate arrangements have been made with the Company for the withholding of any taxes which may be due with respect to such shares. The Company may condition delivery of certificates for shares upon the prior receipt from Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with federal and state securities laws. The right to payment of any fractional shares shall be satisfied in cash, measured by the product of the fractional amount times the Fair Market Value of a share on the Vesting Date.

12. Status of Restricted Stock. The Restricted Stock is intended to constitute property that is subject to a substantial risk of forfeiture during the Restricted Period, and subject to federal income tax in accordance with section 83 of the Internal Revenue Code (the “Code”). Section 83 generally provides that Grantee will recognize compensation income with respect to each installment of the Restricted Stock on the Vesting Date in an amount equal to the then fair market value of the shares for which restrictions have lapsed. Alternatively, Grantee may elect, pursuant to Section 83(b) of the Code, to recognize compensation income for all or any part of the Restricted Stock at the Date of Grant in an amount equal to the fair market value of the Restricted Stock subject to the election on the Date of Grant. Such election must be made within 30 days of the Date of Grant and Grantee shall immediately notify the Company if such an election is made. Grantee should consult his or her tax advisors to determine whether a Section 83(b) election is appropriate.

4

13. Administration. This Award has been granted pursuant to and is subject to the terms and provisions of the Plan. All questions of interpretation and application of the Plan and this Award shall be determined by the Committee. The Committee’s determination shall be final, binding and conclusive.

14. Award Not to Affect Employment. Nothing herein contained shall affect the right of the Company or any Affiliate to terminate Grantee’s employment, services, responsibilities, duties, or authority to represent the Company or any Affiliate at any time for any reason whatsoever.

15. Withholding of Taxes. Whenever the Company proposes or is required to deliver or transfer shares in connection with this Award, the Company shall have the right to (a) require Grantee to remit to the Company an amount sufficient to satisfy any federal, state and/or local withholding tax requirements prior to the delivery or transfer of any certificate or certificates for such shares or (b) take whatever action it deems necessary to protect its interest with respect to tax liabilities. In addition, Grantee shall have the right to have such withholding tax requirements satisfied, either in whole or in part, by means of a relinquishment back to, the Company of a number of shares as to which Grantee’s interest is fully vested having a Fair Market Value equal to the amount of such withholding tax requirements as Grantee indicates he wants to meet by such means.

16. Governing Law. The validity, performance, construction and effect of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without giving effect to principles of conflicts of law.

17. Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter, except that the Employment Agreement shall control in the event of any inconsistencies between this Agreement and the Employment Agreement.

5

IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement as of the day and year first above written.

THE BON-TON STORES, INC.
By:	/s/ Byron L. Bergren
	Byron L. Bergren
	President and Chief Executive Officer
/s/ Anthony Buccina
Anthony Buccina

6

EX-10.4

Exhibit 10.4

EMPLOYMENT AGREEMENT

THIS AGREEMENT (“Agreement”) is by and between THE BON-TON STORES, INC., a Pennsylvania corporation (the “Company”), and STEPHEN BYERS (the “Employee”) as of the 1^st day of February, 2009.

W I T N E S S E T H:

WHEREAS, Employee is currently party to an Employment Agreement dated June 28, 2006, as amended by the First Amendment to Employment Agreement dated December 20, 2006, the term of which expires January 31, 2009 (together, the “Prior Employment Agreement”); and

WHEREAS, the Company and Employee have agreed upon terms upon which Employee will continue his employment with the Company.

NOW THEREFORE, in consideration of the mutual promises and covenants contained herein and intending to be legally bound hereby, the Company and Employee agree as follows:

1. Position and Responsibilities.

(a) The Company hereby employs Employee and Employee hereby accepts continued employment by the Company as the Company’s Vice Chairman, Stores, Visual, Construction, Real Estate, Distribution & Logistics, Loss Prevention. Employee will perform duties as determined by the Chief Executive Officer of the Company. Employee shall report directly to the Chief Executive Officer or such other senior executive officer of the Company designated by the Chief Executive Officer or the person performing the duties of the Chief Executive Officer. In addition, Employee shall be a member of the Management Committee and the Operating Committee.

(b) Throughout the term of this Agreement, Employee shall devote his entire working time, energy, attention, skill and best efforts to the affairs of the Company and to the performance of his duties hereunder in a manner that will faithfully and diligently further the business and interests of the Company. Approval of board memberships and participation in lectures and teaching activities will be at the discretion of the Chief Executive Officer; however, such approval will not be unreasonably withheld, provided that such activities do not significantly interfere with Employee’s duties under this Agreement. Employee shall comply with the Company’s Code of Ethical Standards and Business Practices.

2. Term and Renewal. This Agreement shall become effective on February 1, 2009, provided that this Agreement has been signed by Employee and the Company and these terms approved by the Human Resources and the Compensation Committee (“HRCC”) of the Company’s Board of Directors. The initial term shall continue through April 30, 2011, unless sooner terminated in accordance with paragraph 9 below (the “Initial Term”). Unless terminated by either party not later than the last Friday in January preceding the termination date of the Agreement, this Agreement shall renew for successive one-year terms beginning May 1^st of each such year.

3. Place of Performance. Employee shall be based at the office of the Company in Milwaukee, Wisconsin, except for travel required for Company business.

4. Compensation.

(a) Salary. Employee shall receive a base salary (the “Base Salary”) at the annual rate of $533,500, effective February 1, 2009. This Base Salary, less taxes and normal deductions, shall be paid to Employee in substantially equal installments in accordance with the Company’s regular executive payroll practices in effect from time to time. The Base Salary may be reviewed from time to time, but no less than annually, during the term of this Agreement by the Chief Executive Officer (subject to review by the HRCC) to ascertain whether, in the Company’s sole discretion, such Base Salary should be increased, and once increased, such Base Salary shall not be decreased. The first such salary review shall occur for Fiscal Year 2009 consistent with the Company’s practice for such year for similar senior executives.

(b) Restricted Shares. On February 2, 2009, Employee will be granted 70,000 restricted shares of the Company’s Common Stock (“Restricted Shares”) pursuant to the terms of the 2000 Stock Incentive and Performance-Based Award Plan (the “SIP”). Employee’s ownership of the Restricted Shares will vest on April 30, 2011, provided he is still employed on such date.

(c) Performance Based Compensation.

(i) Annual Bonus.

A. For the Company’s Fiscal Year 2009 and thereafter, Employee shall be eligible for a bonus under the Cash Bonus Plan (the “Annual Bonus”) with the following parameters: a target bonus of 100% of Employee’s Base Salary in effect on the last day of the relevant fiscal year; a threshold bonus and a maximum bonus shall be as determined from time to time by the Company consistent with other similar senior executives under the Cash Bonus Plan. The performance measures and weighting of these performance measures shall be determined by the HRCC consistent with its determinations for other senior executives under the Cash Bonus Plan.

B. Nothing herein is a guarantee that any Annual Bonus will be paid.

2

C. To the extent reasonably practicable, the Annual Bonus shall be computed within 90 days following the close of the Company’s fiscal year and paid within 30 days of its computation. Employee must be employed on the last day of the Company’s fiscal year to receive an Annual Bonus with respect to that fiscal year.

(ii) Performance-Based Award of Restricted Shares. Employee will be eligible to receive 35,000 restricted shares of the Company’s Common Stock as a performance-based award for Fiscal Year 2009 and 35,000 restricted shares of the Company’s Common Stock as a performance-based award for Fiscal Year 2010 as set forth in a Stock Agreement entered into pursuant to the terms of the SIP.

5. Allowances. The Company will reimburse employee on a one-time basis for reasonable attorneys fees expended in review and negotiation of this Agreement, up to a maximum of $5,000.

6. Medical Insurance. During the term of his employment, Employee and his eligible dependents shall be eligible to participate in the Company’s group medical, dental and vision plans (the “Health Plans”) in accordance with the terms of the Health Plans and, subject to the restrictions and limitations contained in the insurance agreement or agreements. For the number of months for which the Employee is receiving severance payments pursuant to paragraph 10, (e.g., two times base salary equals twenty-four months), Employee and his eligible dependents shall be eligible to continue to participate in the Health Plans in which the Employee is enrolled at the time of termination of employment, subject to the restrictions and limitations contained in the insurance agreement or agreements. The Company shall pay the company contribution for such Health Plans, and Employee shall pay the associate portion of Health Plan costs, as in effect at such time.

7. Other Benefits. Employee shall be eligible to participate in the Company’s profit sharing plan, deferred compensation plan, discount program, vacation plan, long-term disability plan and employee benefit programs generally made available to other employees of the Company, subject to their respective generally applicable eligibility requirements, terms, conditions and restrictions; provided, however, that severance payments under this Agreement shall be in lieu of any severance benefits otherwise provided by the Company. However, nothing in this Agreement shall preclude the Company from amending or terminating any such insurance, benefit, program or plan so long as the amendment or termination is applicable to the Company’s executives participating in such insurance, benefit, program or plan generally. Moreover, the Company’s obligations under this provision shall not apply to any insurance, benefit, program or plan made available on an individual basis to one or more select executive employees by contract if such insurance, benefit, program or plan is not made available to all executive employees. With respect to Employee’s participation in the Company’s vacation plan, Employee shall be eligible for four weeks vacation per calendar year, which vacation entitlement shall be pro-rated in any calendar year in which Employee does not work the entire calendar year.

3

8. Business Expenses. The Company shall pay or reimburse Employee for reasonable entertainment and other expenses incurred by Employee in connection with the performance of Employee’s duties under this Agreement upon receipt of vouchers therefor and in accordance with the Company’s regular reimbursement procedures and practices in effect from time to time.

9. Termination of Employment. Notwithstanding any other provision of this Agreement, Employee’s employment and all of the Company’s obligations or liabilities under this Agreement may be terminated immediately, excluding any obligations the Company may have under paragraph 10 below, in any of the following circumstances:

(a) Disability or Incapacity. In the event of Employee’s physical or mental inability to perform his essential duties hereunder, with or without reasonable accommodation, for a period of 13 consecutive weeks or for a cumulative period of 26 weeks during any rolling 24-month period during the term of this Agreement.

(b) Death of Employee. In the event of Employee’s death.

(c) Resignation for Good Reason. Employee may resign for “Good Reason,” defined below, upon 30 days’ written notice by Employee to the Company except as set forth in paragraph 9(d) below. The Company may waive Employee’s obligation to work during this 30-day notice period and terminate his employment immediately, but if the Company takes this action in the absence of agreement by Employee, Employee shall receive the salary that otherwise would be due through the end of the notice period. For purposes of this Agreement, “Good Reason” shall mean any of the following violations of this Agreement by the Company: any reduction in Employee’s Base Salary; except as provided in this Agreement, any reduction in Employee’s potential bonus target percentage amounts; any relocation of Employee from Milwaukee, Wisconsin; and any substantial breach by the Company of any material provision of this Agreement. Notwithstanding the foregoing, the acts or omissions described above shall not constitute “Good Reason” unless Employee provides the Company with written notice detailing the matters he asserts to be “Good Reason” which the Company does not cure within thirty (30) days of receiving the written notice.

(d) Change of Control. In the event of a Change of Control of the Company, provided the Company or Surviving Company (as defined below) continues to pay Employee his Base Salary and provide materially comparable benefits, Employee shall be prohibited from resigning for Good Reason for a period of six months following the Change of Control. If, in the event of a Change of Control, Employee is required to relocate from the Milwaukee, Wisconsin metropolitan area, Employee may resign for Good Reason at any time. For purposes of this Agreement, a Change of Control shall be deemed to occur if:

(i) any person who is not an affiliate of the Company on the date hereof becomes a beneficial owner of a majority of the outstanding voting power of the Company’s capital stock;

4

(ii) the shareholders of the Company approve and there is consummated any plan of liquidation providing for the distribution of all or substantially all of the Company’s assets;

(iii) there is consummated a merger, consolidation or other form of business combination involving the Company, or, in one transaction or a series of related transactions, a sale of all or substantially all of the assets of the Company, unless, in any such case:

(A) the business of the Company is continued following such transaction by a resulting entity (which may be, but need not be, the Company) (the “Surviving Company”); and

(B) persons who were the beneficial owners of a majority of the outstanding voting power of the Company immediately prior to the completion of such transaction beneficially own, by reason of such prior beneficial ownership, a majority of the outstanding voting power of the Surviving Company (or a majority of the outstanding voting power of the direct or indirect parent of the Surviving Company, as the case may be) immediately following the completion of such transaction; or

(iv) any person beneficially owns shares of the Company’s capital stock possessing a greater voting power than held in the aggregate by M. Thomas Grumbacher, any member of his family, any trust for the primary benefit of M. Thomas Grumbacher or any member of his family, and any charitable foundation of which M. Thomas Grumbacher is a founder or co-founder with his wife (collectively, the “Grumbacher Affiliates”), or if the Grumbacher Affiliates control less than twenty percent (20%) of the outstanding voting power of the Company’s capital stock.

For purposes of this definition, the terms “person,” “beneficial owner,” “beneficial ownership,” “affiliate” and “control” shall have the meanings ascribed to such terms under Sections 13(d) and 3(a)(9) and Rule 13d-3 under the Securities Exchange Act of 1934 as amended, and Rule 501 under the Securities Act of 1933 as amended, as applicable.

(e) Discharge for Cause. The Company may discharge Employee at any time for “Cause,” which shall be limited to: Employee’s material and serious breach or neglect of Employee’s responsibilities; willful violation or disregard of standards of conduct established by law; willful violation or disregard of standards of conduct established by Company policy as may from time to time be communicated to Employee; fraud, willful misconduct, misappropriation of funds or other dishonesty; conviction of a crime of moral turpitude; any misrepresentation made in this Agreement; or any material breach by Employee of any provision of this Agreement (including, without limitation, acceptance of employment with another company or performing work or providing advice to another company, as an employee, consultant or in any other similar capacity while still an employee of the Company).

(f) Discharge without Cause. Notwithstanding any other provision of this Agreement, Employee’s employment and any and all of the Company’s obligations under this Agreement (excluding any obligations the Company may have under paragraph 10 below) may be terminated by the Company at any time without Cause.

5

10. Payments Upon Termination.

(a) Discharge Without Cause, Resignation for Good Reason, or End of Term. If Employee is discharged without Cause or resigns for Good Reason during the term of this Agreement, Employee shall receive severance pay equal to the greater of (i) his Base Salary for the remaining term of this Agreement or (ii) two times his then Base Salary. The severance payment shall be payable in a lump sum as soon as practicable following the six (6) month anniversary of Employee’s termination of employment. The severance payment will be made provided that Employee signs and does not timely revoke a general release of claims (including, without limitation, contractual, common law and statutory claims) against the Company and its officers, directors, employees and agents. This severance payment shall be in lieu of any other severance payment to which Employee is entitled by reason of the Prior Employment Agreement or any severance plan sponsored by Saks, Inc. or the Company. Employee will also receive any vested benefits to which Employee is entitled under the Company’s stock options and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in these plans.

(b) Death or Disability/Incapacity.

(i) Upon death, Employee’s estate’s sole entitlement will be to Base Salary for any days worked prior to his death, amounts payable on account of Employee’s death under any insurance or benefit plans or policies maintained by the Company, and any vested benefits to which Employee is entitled under the Company’s stock option and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in those plans.

(ii) On termination for disability or incapacity, Employee’s sole entitlement will be to Base Salary for any days worked prior to the date of termination, amounts payable on account of disability or incapacity under any insurance or benefit plans or policies maintained and any vested benefits to which Employee is entitled under the Company’s stock option and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in those plans.

(c) Discharge for Cause. If Employee is discharged for Cause or resigns without Good Reason, Employee’s sole entitlement will be the receipt of Base Salary for any days worked through the date of termination and any vested benefits to which Employee is entitled under the Company’s stock option and employee benefit plans in accordance with, to the extent provided in, and subject to the restrictions and payout schedules contained in those plans.

6

(d) Change of Control.

(i) Upon a Change of Control as defined in paragraph 9(d) while Employee is employed pursuant to this Agreement, if Employee is discharged without Cause or resigns for Good Reason within two years of the consummation of the Change of Control, Employee shall receive severance pay equal to (i) two times the average Base Salary paid to Employee for the most recently completed three W-2 years prior to discharge or resignation and (ii) two times the average Annual Bonus paid for the most recently completed three W-2 years prior to discharge or resignation. The severance payment shall be payable in a lump sum as soon as practicable following the six (6) month anniversary of Employee’s termination of employment. The severance payment will be made provided that Employee signs and does not timely revoke a general release of claims (including, without limitation, contractual, common law and statutory claims) against the Company and its officers, directors, employees and agents. This severance payment shall be in lieu of any other severance payment to which Employee is entitled by reason of the Prior Employment Agreement or any severance plan sponsored by Saks, Inc. or the Company.

(ii) Upon a Change of Control as defined in paragraph 9(d) while Employee is employed pursuant to this Agreement, the vesting of stock options and Restricted Shares held by Employee shall be governed by the terms of such stock options or Restricted Shares.

(iii) Notwithstanding any other provision of this Agreement, if the aggregate present value of the “parachute payments” to the Employee, determined under Section 280G(b) of the Internal Revenue Code of 1986, as amended (the “Code”), would be at least three times the “base amount” determined under Code Section 280G, then the “280G Permitted Payment” shall be the maximum benefit that may be realized upon a Change of Control under this paragraph 10(d) such that the aggregate present value of such “parachute payments” to Employee is less than three times his “base amount.” In addition, in the event the aggregate present value of the parachute payments to Employee would be at least three times his base amount even after a reduction of the Change of Control benefits to $0 (all as determined for purposes of Code Section 280G), compensation otherwise payable under this Agreement and any other amount payable hereunder or any other severance plan, program, policy or obligation of the Company or any other affiliate thereof that would constitute “parachute payments” shall be reduced so that the aggregate present value of all “parachute payments” to Employee, as determined under Code Section 280G(b) is less than three times his base amount. Any decisions regarding the requirement or implementation of such reductions shall be made by such tax counsel as may be selected by the Company and acceptable to Employee.

11. Company Property. All advertising, sales, manufacturers’ and other materials or articles or information, including, without limitation, data processing reports, customer sales analyses, invoices, price lists or information or any other materials or data of any kind furnished to Employee by the Company or developed by Employee on behalf of the Company or at the Company’s direction or for the Company’s use or otherwise in connection with Employee’s employment with the Company, are and shall remain the sole and confidential property of the Company.

7

12. Non-Competition and Confidentiality. To the maximum extent permissible by law:

(a) During his employment with the Company and for a period of one year after the termination of his employment with the Company for any reason whatsoever, whether by Employee or by the Company and whether during the term of this Agreement or subsequent to the expiration of this Agreement, Employee shall not, directly or indirectly induce or intentionally influence any customer, employee, consultant, independent contractor or supplier of the Company to change his, her or its business relationship with or terminate employment with the Company.

(b) During his employment with the Company and after the termination of his employment with the Company for any reason whatsoever, whether by Employee or by the Company and whether during the term of this Agreement or subsequent to the expiration of this Agreement for a period equal to one-half of the period for which the Employee receives severance payments according to paragraph 10(a), Employee shall not engage in (as a principal, partner, director, officer, agent, employee, consultant, owner, independent contractor or otherwise) or be financially interested in the retail department store business of any Competitor of the Company. For purposes of this Agreement, a Competitor means each of Federated Department Stores, Dillard’s Inc., Kohl’s Corporation, Belk, Inc. and J.C. Penney, Inc. or the affiliates and successors of each of them.

(c) During his employment with the Company and at all times thereafter, and except as required by law, Employee shall not use for his personal benefit, or disclose, communicate or divulge to, or use for the direct or indirect benefit of, any person, firm, association or company other than the Company, any confidential information of the Company that Employee acquires in the course of his employment, which is not otherwise lawfully known by and readily available to the general public. This confidential information includes, but is not limited to: any material referred to in paragraph 11 or any non-public information regarding the business, marketing, legal or accounting methods, policies, plans, procedures, strategies or techniques; research or development projects or results; trade secrets or other knowledge or processes of or developed by the Company; names and addresses of employees, suppliers or customers. Employee confirms that such information is confidential and constitutes the exclusive property of the Company, and agrees that, immediately upon his termination, whether by Employee or by the Company and whether during the term of this Agreement or subsequent to the expiration of this Agreement, Employee shall deliver to the Company all correspondence, documents, books, records, lists, computer programs and other writings relating to the Company’s business; and Employee shall retain no copies, regardless of where or by whom said writings were kept or prepared.

8

(d) Both during his employment with the Company and following his termination for any reason, whether by Employee or by the Company and whether during the term of this Agreement or following the expiration of the Agreement, Employee shall, upon reasonable notice, furnish to the Company such information pertaining to his employment with the Company as may be in his possession. The Company shall reimburse Employee for all reasonable expenses incurred by him in fulfilling his obligation under this subparagraph (d).

(e) The provisions of subparagraphs (a), (b), (c) and (d) shall survive the cessation of Employee’s employment for any reason, as well as the expiration of this Agreement at the end of its term or at any time prior thereto.

(f) Employee acknowledges that the restrictions contained in this paragraph 12, in view of the nature of the business in which the Company is engaged and the Employee’s position with the Company, are reasonable and necessary to protect the legitimate interests of the Company, and that any violation of those restrictions would result in irreparable injury to the Company. Employee therefore agrees that, in the event of his violation of any of those restrictions, the Company shall be entitled to obtain from any court of competent jurisdiction preliminary and permanent injunctive relief against Employee, in addition to damages from Employee and an equitable accounting of all commissions, earnings, profits and other benefits arising from such violation, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled.

(g) Employee agrees that if any or any portion of the foregoing covenants, or the application thereof, is construed to be invalid or unenforceable, the remainder of such covenant or covenants or the application thereof shall not be affected and the remaining covenant or covenants will then be given full force and effect without regard to the invalid or unenforceable portions. If any covenant is held to be unenforceable because of the area covered, the duration thereof, or the scope thereof, Employee agrees that the Court making such determination shall have the power to reduce the area and/or the duration, and/or limit the scope thereof, and the covenant shall then be enforceable in its reduced form. If Employee violates any of the restrictions contained in subparagraphs (a) or (b), the period of such violation (from the commencement of any such violation until such time as such violation shall be cured by Employee to the satisfaction of the Company) shall not count toward or be included in the restrictive period contained in subparagraphs (a) and (b).

(h) For purposes of paragraphs 11 and 12 of this Agreement, the term “Company” shall include not only The Bon-Ton Stores, Inc., but also any of its successors, assigns, subsidiaries or affiliates. Employee consents to the assignment of this Agreement to any purchaser of the Company or a substantial portion of its assets.

13. Other Tax Matters.

(a) Employee agrees that he is responsible for paying any and all federal, state and local income taxes assessed with respect to any money, benefits or other consideration received from the Company and that the Company is entitled to withhold any tax payments from amounts otherwise due Employee to the extent required by applicable statutes, rulings or regulations.

9

(b) Compliance With Code Section 409A.

(i) Notwithstanding anything to the contrary herein, no payment otherwise required to be made hereunder that the Company determines constitutes a payment of nonqualified deferred compensation for purposes of Section 409A of the Code shall be paid to Employee at a time or in a manner that will be treated as a violation of the distribution rules of Code Section 409A(a)(2) and no alternative form of payment of such amount(s) shall be permitted to be made hereunder if such alternative benefit form would violate any of the requirements of Code Section 409A(a)(3) or (4) relating to acceleration of benefits and changes in time and form of distribution (taking into account any regulations or other guidance issued by Treasury or the Internal Revenue Service with regard to these Code provisions as may be in effect from time to time).

(ii) The intent of this provision is to ensure that no additional tax liabilities are imposed on any payments or benefits provided hereunder pursuant to Code Section 409A, and may require, for example, a delay in commencement of payments until six months after Employee’s termination of employment with the Company. In the event any payment is delayed by reason of this paragraph 13, such payment shall, when made, be increased by an amount representing “interest” from the date payment would otherwise have been made, through the date payment is actually made, calculated using the Company’s cost of borrowing as the interest rate, as determined by the Company at its discretion.

14. Prior Agreements.

(a) Employee represents that there are no restrictions, agreements or understandings whatsoever to which Employee is a party that could impact upon his employment under this Agreement or that would prevent or make unlawful his execution of this Agreement or his employment hereunder.

(b) Employee agrees that he will not use or disclose any confidential or proprietary information of any of his prior employers during the course of his employment under this Agreement.

15. Entire Understanding. This Agreement contains the entire understanding between the Company and Employee with respect to the subject matter hereof and supersedes all prior and contemporary agreements and understandings, inducements or conditions, express or implied, written or oral, between the Company and Employee except as herein contained. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof.

10

16. Modifications. This Agreement may not be modified orally but only by written agreement signed by Employee and the Company’s Chief Executive Officer or such other person as the Board may designate specifically for this purpose.

17. Provisions Separable. The provisions of this Agreement are independent of and separable from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue of the fact that for any reason any other or others of them may be invalid or unenforceable in whole or in part.

18. Consolidation, Merger or Sale of Assets. Nothing in this Agreement shall preclude the Company from consolidating or merging into or with, or transferring all or substantially all of its assets to, another entity that assumes this Agreement and all obligations and undertakings of the Company hereunder. Under such a consolidation, merger or transfer of assets and assumption, the term “the Company” as used herein, shall mean such other entity and this Agreement shall continue in full force and effect.

19. Notices. All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given, made and received when delivered (personally, by courier service such as UPS or by messenger) or when deposited in the United States mails, registered or certified mail, postage pre-paid, return receipt requested, addressed as set forth below:

(a)	If to the Company:
	The Bon-Ton Stores, Inc. 331 W. Wisconsin Avenue Milwaukee, WI 53203 Attention: Chief Executive Officer
	with a copy to:
	The Bon-Ton Stores, Inc. 2801 East Market Street York, PA 17402 Attention: General Counsel
(b)	If to Employee:
	Stephen Byers 629 Fox Glen Drive St. Charles, IL 60174

In addition, notice by mail shall be by air mail or courier if posted outside of the continental United States. Any party may alter the address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions of this paragraph for the giving of notice.

11

20. No Attachment. Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation or to execution, attachment, levy or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

21. Binding Agreement. This Agreement shall be binding upon, and shall inure to the benefit of the Company and its successors, representatives, and assigns and shall be binding upon Employee, his heirs, executors and legal representatives.

22. No Assignment by Employee. Employee acknowledges that the services to be rendered by him are unique and personal. Accordingly, Employee may not assign or delegate any of his rights or obligations hereunder, except that he may assign certain rights hereunder if agreed to in writing by the Chief Executive Officer.

23. Indulgences. Neither the failure nor any delay on the part of either party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

24. Paragraph Headings. The paragraph headings in this Agreement are for convenience only; they form no part of this Agreement and shall not affect its interpretation.

25. Controlling Law. This Agreement and all questions relating to its validity, interpretation, performance and enforcement (including, without limitation, provisions concerning limitations of actions), shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania, notwithstanding any conflict-of-laws doctrines of such state or any other jurisdiction to the contrary, and without the aid of any canon, custom or rule of law requiring construction against the draftsman.

26. Chief Executive Officer. In the absence of the Chief Executive Officer, the decisions of the Chief Executive Officer may be made by such other person as designated by the Company’s Board.

27. Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties hereto.

12

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have duly executed and delivered, in Pennsylvania, this Agreement as of the date first above written.

THE BON-TON STORES, INC.
By:	/s/ Byron L. Bergren
	Byron L. Bergren
	President and Chief Executive Officer

EMPLOYEE:
 

/s/ Stephen Byers  

Stephen Byers 

13

EX-10.5

Exhibit 10.5

THE BON-TON STORES, INC.

RESTRICTED STOCK AGREEMENT

This is a Restricted Stock Agreement dated as of February 2, 2009 (“Agreement”), between The Bon-Ton Stores, Inc. (the “Company”) and the undersigned (“Grantee”). This Agreement is entered into pursuant to the provisions of the Plan (as defined below) and in connection with a certain employment agreement entered into by and between the Grantee and the Company as of February 1, 2009, (the employment agreement, including all amendments thereto being referred to herein as the “Employment Agreement”). This Agreement is intended to be consistent with the Employment Agreement and specifically those provisions of the Employment Agreement regarding the grant of “Restricted Shares,” and shall be so interpreted. To the extent any provision hereof is inconsistent with the provisions of the Employment Agreement, the provisions of the Employment Agreement shall be given effect. To the extent the definition of any terms defined in the Employment Agreement is modified from time to time by amendments made to the Employment Agreement, the definition as in effect at the relevant time shall apply for purposes of this Agreement.

1. Definitions. As used herein:

(a) “Date of Grant” means February 2, 2009, the date on which the Company awarded the Restricted Stock.

(b) “Forfeiture Date” means any date as of which Grantee’s rights to all or any portion of the Restricted Stock are forfeited pursuant to applicable provisions of this Agreement.

(c) “Plan” means The Bon-Ton Stores, Inc. Amended and Restated 2000 Stock Incentive and Performance-Based Award Plan, as amended from time to time.

(d) “Restricted Period” with respect to any shares of Restricted Stock means the period beginning on the Date of Grant and ending on the Vesting Date for such shares.

(e) “Vesting Date” with respect to any shares of Restricted stock means the date set as a vesting date pursuant to Paragraph 2 hereof, or such earlier vesting date as is otherwise provided herein.

All other capitalized terms used herein shall have the meaning set forth in the Employment Agreement or in the Plan except to the extent the context clearly requires otherwise. This Agreement is intended to be consistent with the terms of the Plan and is subject in all regards to the terms of the Plan. In the event of any inconsistency in the definition contained in the Employment Agreement and that contained in the Plan, the definition in the Employment Agreement shall control.

2. Grant of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, the Company grants to Grantee seventy thousand (70,000) shares of the Company’s Common Stock, par value $.01 (the “Restricted Stock”). All of the Restricted Stock shall vest on April 30, 2011, provided that, on such applicable Vesting Date, Grantee is, and has continuously been, an employee of the Company or an Affiliate of the Company during such shares’ Restricted Period. In lieu of vesting of the Restricted Stock on the Vesting Dates noted above, the Restricted Stock shall become fully vested: (i) if Grantee’s employment is terminated by the Company without Cause (as that term is defined in the Employment Agreement) or if the Grantee resigns from his employment with the Company or an Affiliate of the Company for Good Reason (as that term is defined in the Employment Agreement), provided Grantee executes a general release as required under applicable provisions of the Employment Agreement; or (ii) in accordance with Paragraph 8 below in the event of a Change of Control of the Company.

3. Restrictions on Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, Grantee shall not be permitted to sell, transfer, pledge or assign any Restricted Stock during such shares’ Restricted Period.

4. Lapse of Restrictions. Subject to the terms and conditions set forth herein and in the Plan, the restrictions on Restricted Stock set forth in Paragraph 3 shall lapse on the Vesting Date.

5. Forfeiture of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, if Grantee’s employment with the Company or an Affiliate of the Company terminates during the Restricted Period for any reason, such date shall be the Forfeiture Date, and Grantee shall forfeit any Restricted Stock still subject to restrictions as of the Forfeiture Date; provided, however, that any shares required to be vested pursuant to the Employment Agreement by reason of the Grantee’s termination of employment (i.e., discharge by the Company without Cause or resignation for Good Reason, provided Grantee executes a general release as required under applicable provisions of the Employment Agreement), shall be treated as vested as of such termination of employment and no Forfeiture Date shall be applicable to Grantee’s Restricted Stock under such circumstances. Upon a forfeiture of any shares of Restricted Stock as provided in this Paragraph 5, the shares of Restricted Stock so forfeited shall be reacquired by the Company without consideration as of the Forfeiture Date.

6. Rights of Grantee. Except for the restrictions set forth in Paragraph 3, during the Restricted Period Grantee shall have all of the rights of a shareholder with respect to the Restricted Stock, including the right to vote the Restricted Stock to the same extent that such shares could be voted if they were not subject to the restrictions set forth in this Agreement.

7. Dividends on Restricted Stock. Any cash dividends payable with respect to the Restricted Stock during the Restricted Period shall be paid to Grantee. Any extraordinary dividends or dividends that are in the nature of a distribution of shares or are otherwise equivalent to a stock split, shall be subject to the same restrictions as apply to the Restricted Stock with respect to which such extraordinary dividends or shares were issued and shall be forfeited in accordance with Paragraph 5 unless the restrictions lapse in accordance with Paragraph 4.

2

8. Change of Control of Company. In the event of a Change of Control (as defined, from time to time, in the Employment Agreement), the Restricted Stock shall immediately become fully vested.

9. Notices. Any notice to be given to the Company shall be addressed to the Controller of the Company at its principal executive office, and any notice to be given to Grantee shall be addressed to Grantee at the address then appearing on the personnel records of the Company or the Affiliate of the Company by which he or she is employed, or at such other address as either party hereafter may designate in writing to the other. Any such notice shall be deemed to have been duly given when personally delivered, by courier service such as Federal Express, or by other messenger, or when deposited in the United States mail, addressed as aforesaid, registered or certified mail, and with proper postage and registration or certification fees prepaid.

10. Securities Laws. The Committee may from time to time impose any conditions on the Restricted Stock as it deems necessary or advisable to ensure that all rights granted under the Plan satisfy the conditions of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of 1934, as amended.

11. Delivery of Shares. Upon a Vesting Date, the Company shall notify Grantee (or Grantee’s personal representative, heir or legatee in the event of Grantee’s death) that the restrictions on an installment of Restricted Stock have lapsed, and shall, without payment from Grantee for such Restricted Stock, upon such Grantee’s request deliver a certificate for such Restricted Stock without any legend or restrictions, except for such restrictions as may be imposed by the Committee, in its sole judgment, under Paragraph 10, provided that no certificates for shares will be delivered to Grantee (or to his or her personal representative, heir or legatee) until appropriate arrangements have been made with the Company for the withholding of any taxes which may be due with respect to such shares. The Company may condition delivery of certificates for shares upon the prior receipt from Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with federal and state securities laws. The right to payment of any fractional shares shall be satisfied in cash, measured by the product of the fractional amount times the Fair Market Value of a share on the Vesting Date.

12. Status of Restricted Stock. The Restricted Stock is intended to constitute property that is subject to a substantial risk of forfeiture during the Restricted Period, and subject to federal income tax in accordance with section 83 of the Internal Revenue Code (the “Code”). Section 83 generally provides that Grantee will recognize compensation income with respect to each installment of the Restricted Stock on the Vesting Date in an amount equal to the then fair market value of the shares for which restrictions have lapsed. Alternatively, Grantee may elect, pursuant to Section 83(b) of the Code, to recognize compensation income for all or any part of the Restricted Stock at the Date of Grant in an amount equal to the fair market value of the Restricted Stock subject to the election on the Date of Grant. Such election must be made within 30 days of the Date of Grant and Grantee shall immediately notify the Company if such an election is made. Grantee should consult his or her tax advisors to determine whether a Section 83(b) election is appropriate.

3

13. Administration. This Award has been granted pursuant to and is subject to the terms and provisions of the Plan. All questions of interpretation and application of the Plan and this Award shall be determined by the Committee. The Committee’s determination shall be final, binding and conclusive.

14. Award Not to Affect Employment. Nothing herein contained shall affect the right of the Company or any Affiliate to terminate Grantee’s employment, services, responsibilities, duties, or authority to represent the Company or any Affiliate at any time for any reason whatsoever.

15. Withholding of Taxes. Whenever the Company proposes or is required to deliver or transfer shares in connection with this Award, the Company shall have the right to (a) require Grantee to remit to the Company an amount sufficient to satisfy any federal, state and/or local withholding tax requirements prior to the delivery or transfer of any certificate or certificates for such shares or (b) take whatever action it deems necessary to protect its interest with respect to tax liabilities. In addition, Grantee shall have the right to have such withholding tax requirements satisfied, either in whole or in part, by means of a relinquishment back to, the Company of a number of shares as to which Grantee’s interest is fully vested having a Fair Market Value equal to the amount of such withholding tax requirements as Grantee indicates he wants to meet by such means.

16. Governing Law. The validity, performance, construction and effect of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without giving effect to principles of conflicts of law.

17. Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter, except that the Employment Agreement shall control in the event of any inconsistencies between this Agreement and the Employment Agreement.

4

IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement as of the day and year first above written.

THE BON-TON STORES, INC.
By:	/s/ Byron L. Bergren
	Byron L. Bergren
	President and Chief Executive Officer
/s/ Stephen Byers
Stephen Byers

5

EX-10.6

Exhibit 10.6

THE BON-TON STORES, INC.

RESTRICTED STOCK AGREEMENT
PERFORMANCE SHARES

This is a Restricted Stock Agreement — Performance Shares dated as of February 2, 2009 (“Agreement”), between The Bon-Ton Stores, Inc. (the “Company”) and the undersigned (“Grantee”). This Agreement is entered into pursuant to the provisions of the Plan (as defined below) and in connection with a certain employment agreement entered into by and between the Grantee and the Company as of February 1, 2009, (the employment agreement, including all amendments thereto being referred to herein as the “Employment Agreement”). This Agreement is intended to be consistent with the Employment Agreement and specifically those provisions of the Employment Agreement regarding “Performance-Based Award of Restricted Shares” and shall be so interpreted. To the extent any provision hereof is inconsistent with the provisions of the Employment Agreement, the provisions of the Employment Agreement shall be given effect. To the extent the definition of any terms defined in the Employment Agreement is modified from time to time by amendments made to the Employment Agreement, the definition as in effect at the relevant time shall apply for purposes of this Agreement. All determinations regarding the vesting of Restricted Stock hereunder shall be made by the Committee (as that term is defined in the Plan) consistent with the Plan’s provisions regarding performance-based compensation.

1. Definitions. As used herein:

(a) “Date of Grant” means February 2, 2009, the date on which the Company awarded the Restricted Stock.

(b) “Forfeiture Date” means any date as of which Grantee’s rights to all or any portion of the Restricted Stock are forfeited pursuant to applicable provisions of this Agreement.

(c) “Plan” means The Bon-Ton Stores, Inc. Amended and Restated 2000 Stock Incentive and Performance-Based Award Plan, as amended from time to time.

(d) “Restricted Period” with respect to any shares of Restricted Stock means the period beginning on the Date of Grant and ending on the Vesting Date for such shares.

(e) “Vesting Date” with respect to any shares of Restricted stock means the date set as a vesting date pursuant to Paragraph 2 hereof, or such earlier vesting date as is otherwise provided herein.

All other capitalized terms used herein shall have the meaning set forth in the Employment Agreement or in the Plan except to the extent the context clearly requires otherwise. This Agreement is intended to be consistent with the terms of the Plan and is subject in all regards to the terms of the Plan. In the event of any inconsistency in the definition contained in the Employment Agreement and that contained in the Plan, the definition in the Employment Agreement shall control.

2. Grant of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, the Company grants to Grantee seventy thousand (70,000) shares of the Company’s Common Stock, par value $.01 (the “Restricted Stock”). Of the Restricted Stock subject to this Agreement, fifty percent (50%) is subject to vesting (or forfeiture) on the basis of the achievement of certain performance goals to be established for the Company’s 2009 fiscal year (i.e., the fiscal year ending January 30, 2010), and the remaining fifty percent (50%) is subject to vesting (or forfeiture) on the basis of the achievement of performance goals to be established for the Company’s 2010 fiscal year (i.e., the fiscal year ending January 29, 2011). The two portions of the Restricted Stock are referred to herein as the “2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009” and the “2009 Performance Shares Based Upon Company Performance for Fiscal Year 2010,” respectively. Except as otherwise provided herein, the Restricted Stock shall vest (or be forfeited) as follows:

2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009

One hundred percent (100%) of the thirty-five thousand (35,000) 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009 become vested in the event the Company achieves the target financial objectives set by the Committee for Fiscal Year 2009. The Committee may also establish vesting for less than one hundred percent of such shares based on achievement of financial objectives below the target financial objective.

2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010

One hundred percent (100%) of the thirty-five thousand (35,000) 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 become vested in the event the Company achieves the target financial objectives set by the Committee for Fiscal Year 2010. The Committee may also establish vesting for less than one hundred percent of such shares based on achievement of financial objectives below the target financial objective.

Termination of Employment. Any Restricted Stock that is not earned and vested on the effective date of the Grantee’s termination of employment for any reason shall be forfeited (if not already forfeited), subject to the following:

(i) In the event that the Grantee, prior to January 30, 2010 is discharged without Cause or resigns for Good Reason, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009 shall become vested to the extent provided above based on attainment of the performance goals for the Company’s 2009 fiscal year to the same extent such Restricted Stock would have become vested had the Grantee remained employed with the Company or an Affiliate of the Company through the date that the Committee makes a determination regarding the achievement of the performance targets described above for the Company’s 2009 fiscal year; provided, however, that no portion of the 2009 Performance Shares Based Upon Company Performance for Fiscal Year 2009 shall be vested in such a situation unless the Grantee executes a general release as required under applicable provisions of the Employment Agreement; and

2

(ii) In the event that the Grantee, on or after January 30, 2010 and prior to January 30, 2011, is discharged without Cause or resigns for Good Reason, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 shall become vested to the same extent such Restricted Stock would have become vested had the Grantee remained employed with the Company or an Affiliate of the Company through the date that the Committee makes a determination regarding the achievement of the performance goals established for the Company’s 2010 fiscal year; provided, however, that no portion of the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 shall be vested in such a situation unless the Grantee executes a general release of claims consistent with the release of claims as required under applicable provisions of the Employment Agreement.

3. Restrictions on Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan, Grantee shall not be permitted to sell, transfer, pledge or assign any Restricted Stock during such shares’ Restricted Period.

4. Lapse of Restrictions. Subject to the terms and conditions set forth herein and in the Plan, the restrictions on Restricted Stock set forth in Paragraph 4 shall lapse on the Vesting Date.

5. Forfeiture Dates and Forfeiture of Restricted Stock. Subject to the terms and conditions set forth herein and in the Plan: If Grantee’s employment with the Company or an Affiliate of the Company terminates during the Restricted Period for any reason, such date shall be the Forfeiture Date, and Grantee shall forfeit any Restricted Stock still subject to restrictions as of the Forfeiture Date, except as provided above in Paragraph 2. Upon a forfeiture of any shares of Restricted Stock as provided in this Paragraph 5, the shares of Restricted Stock so forfeited shall be reacquired by the Company without consideration.

6. Rights of Grantee. Except for the restrictions set forth in Paragraph 3 and the provisions respecting dividends on Restricted Stock set forth in Paragraph 7, during the Restricted Period Grantee shall have all of the rights of a shareholder with respect to the Restricted Stock, including the right to vote the Restricted Stock to the same extent that such shares could be voted if they were not subject to the restrictions set forth in this Agreement.

7. Dividends on Restricted Stock. No dividends shall accrue or be paid to the Grantee with respect to any shares of Restricted Stock for any period prior to the date such shares become vested.

8. Change of Control of Company. In the event of a Change of Control (as defined, from time to time, in the Employment Agreement) prior to January 30, 2010, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2009 shall immediately become fully vested. In the event of a Change of Control on or after January 30, 2010 and on or before January 29, 2011, the 2009 Performance Shares Based Upon Company Performance For Fiscal Year 2010 shall become vested without regard to the achievement of the goals established for the Company’s 2010 fiscal year on the third month anniversary of the date of the Change of Control, provided the Grantee remains employed by the Company or an Affiliate of the Company or, if applicable, a successor company, through such date, or on such earlier date following the Change of Control if the Grantee is terminated by the Company or an Affiliate of the Company or, if applicable, a successor company, without Cause.

3

9. Notices. Any notice to be given to the Company shall be addressed to the Controller of the Company at its principal executive office, and any notice to be given to Grantee shall be addressed to Grantee at the address then appearing on the personnel records of the Company or the Affiliate of the Company by which he or she is employed, or at such other address as either party hereafter may designate in writing to the other. Any such notice shall be deemed to have been duly given when personally delivered, by courier service such as Federal Express, or by other messenger, or when deposited in the United States mail, addressed as aforesaid, registered or certified mail, and with proper postage and registration or certification fees prepaid.

10. Securities Laws. The Committee may from time to time impose any conditions on the Restricted Stock as it deems necessary or advisable to ensure that all rights granted under the Plan satisfy the conditions of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of 1934, as amended.

11. Delivery of Shares. Upon the determination that any portion of the Restricted Stock has become vested, the Company shall notify Grantee (or Grantee’s personal representative, heir or legatee in the event of Grantee’s death) that the restrictions on an installment of Restricted Stock have lapsed, and shall, without payment from Grantee for such Restricted Stock, upon such Grantee’s request deliver a certificate for such Restricted Stock without any legend or restrictions, except for such restrictions as may be imposed by the Committee, in its sole judgment, under Paragraph 10, provided that no certificates for shares will be delivered to Grantee (or to his or her personal representative, heir or legatee) until appropriate arrangements have been made with the Company for the withholding of any taxes which may be due with respect to such shares. The Company may condition delivery of certificates for shares upon the prior receipt from Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with federal and state securities laws. The right to payment of any fractional shares shall be satisfied in cash, measured by the product of the fractional amount times the Fair Market Value of a share on the Vesting Date.

12. Status of Restricted Stock. The Restricted Stock is intended to constitute property that is subject to a substantial risk of forfeiture during the Restricted Period, and subject to federal income tax in accordance with section 83 of the Internal Revenue Code (the “Code”). Section 83 generally provides that Grantee will recognize compensation income with respect to each installment of the Restricted Stock on the Vesting Date in an amount equal to the then fair market value of the shares for which restrictions have lapsed. Alternatively, Grantee may elect, pursuant to Section 83(b) of the Code, to recognize compensation income for all or any part of the Restricted Stock at the Date of Grant in an amount equal to the fair market value of the Restricted Stock subject to the election on the Date of Grant. Such election must be made within 30 days of the Date of Grant and Grantee shall immediately notify the Company if such an election is made. Grantee should consult his or her tax advisors to determine whether a Section 83(b) election is appropriate.

4

13. Administration. This Award has been granted pursuant to and is subject to the terms and provisions of the Plan. All questions of interpretation and application of the Plan and this Award shall be determined by the Committee. The Committee’s determination shall be final, binding and conclusive.

14. Award Not to Affect Employment. Nothing herein contained shall affect the right of the Company or any Affiliate to terminate Grantee’s employment, services, responsibilities, duties, or authority to represent the Company or any Affiliate at any time for any reason whatsoever.

15. Withholding of Taxes. Whenever the Company proposes or is required to deliver or transfer shares in connection with this Award, the Company shall have the right to (a) require Grantee to remit to the Company an amount sufficient to satisfy any federal, state and/or local withholding tax requirements prior to the delivery or transfer of any certificate or certificates for such shares or (b) take whatever action it deems necessary to protect its interest with respect to tax liabilities. In addition, Grantee shall have the right to have such withholding tax requirements satisfied, either in whole or in part, by means of a relinquishment back to, the Company of a number of shares as to which Grantee’s interest is fully vested having a Fair Market Value equal to the amount of such withholding tax requirements as Grantee indicates he wants to meet by such means.

16. Governing Law. The validity, performance, construction and effect of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without giving effect to principles of conflicts of law.

17. Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter, except that the Employment Agreement shall control in the event of any inconsistencies between this Agreement and the Employment Agreement.

5

IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement as of the day and year first above written.

THE BON-TON STORES, INC.
By:	/s/ Byron L. Bergren
	Byron L. Bergren
	President and Chief Executive Officer
/s/ Stephen Byers
Stephen Byers

6

EX-99.1

Exhibit 99.1

NEWS RELEASE

FOR IMMEDIATE RELEASE	CONTACT:
	Mary Kerr
	Vice President
	Investor & Public Relations
	(717) 751-3071
	mkerr@bonton.com

THE BON-TON STORES, INC. ANNOUNCES EMPLOYMENT AGREEMENTS WITH
ANTHONY J. BUCCINA AND STEPHEN R. BYERS

York, PA, January 28, 2009 — The Bon-Ton Stores, Inc. (NASDAQ: BONT) announced the signing, on January 23, 2009, of an Employment Agreement, Restricted Stock Agreement and Restricted Stock Agreement — Performance Shares with each of Anthony J. Buccina, the Company’s Vice Chairman, President — Merchandising, and Stephen R. Byers, Vice Chairman, Stores, Visual, Construction, Real Estate, Distribution & Logistics, Loss Prevention. The respective employment agreements will be effective February 1, 2009 and continue through April 30, 2011.

Bud Bergren, President and Chief Executive Officer, commented, “We are extremely pleased to announce that Tony and Steve will continue in their current positions as valuable members of Bon-Ton’s senior management team. They have provided significant insight and leadership to identify strategic initiatives as we face today’s challenging environment. I look forward to working with them to realize our plan for profitability.”

The Bon-Ton Stores, Inc. operates 281 stores, which includes twelve furniture galleries, in 23 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner’s, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger’s and Younkers nameplates and under the Parisian nameplate, three stores in the Detroit, Michigan area. The stores offer a broad assortment of brand-name fashion apparel and accessories for women, men and children, as well as cosmetics and home furnishings. For further information, please visit the investor relations section of the Company’s website at http://investors.bonton.com.

Certain information included in this press release contains statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, which may be identified by words such as “may,” “could,” “will,” “plan,” “expect,” “anticipate,” “estimate,” “project,” “intend” or other similar expressions, involve important risks and uncertainties that could significantly affect results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by or on behalf of the Company. Factors that could cause such differences include, but are not limited to, risks related to retail businesses generally; a significant and prolonged deterioration of general economic conditions which could negatively impact the Company, including the potential write-down of the current valuation of intangible assets and deferred taxes; consumer spending patterns and debt levels; additional competition from existing and new competitors; inflation; changes in the costs of fuel and other energy and transportation costs; weather conditions that could negatively impact sales; uncertainties associated with opening new stores or expanding or remodeling existing stores; the ability to attract and retain qualified management; the dependence upon vendor relationships; the ability to reduce SG&A expenses and the ability to obtain financing for working capital, capital expenditures and general corporate purposes. Additional factors that could cause the Company’s actual results to differ from those contained in these forward-looking statements are discussed in greater detail under Item 1A of the Company’s Form 10-K filed with the Securities and Exchange Commission.

# # #