DEFA14A

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):  February 5, 2008

CHARMING SHOPPES, INC.

(Exact name of registrant as specified in its charter)

PENNSYLVANIA	000-07258	23-1721355
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

450 WINKS LANE, BENSALEM, PA	19020
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (215) 245-9100

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:

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

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

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

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

Item 8.01.  Other Events.

On February 5, 2008 we issued a press release announcing further initiatives and actions being taken as a result of our ongoing business review and in response to the continuing weak retail and economic environment in which we are currently operating.  A copy of our press release is included as Exhibit 99.1 hereto and is incorporated herein by reference.

Also on February 5, 2008 we delivered a letter and a presentation to our employees in connection with this announcement.  A Copy of our letter to employees is attached as Exhibit 99.2 hereto and is incorporated herein by reference.  A copy of the slide show we used in conjunction with our presentation to our employees is included as Exhibit 99.3 hereto and is incorporated herein by reference.

Item 9.01. Financial Statements Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1	Press Release dated February 5, 2008
99.2	Letter to Employees dated February 5, 2008
99.3	Slide Presentation dated February 5, 2008

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SIGNATURES

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

	CHARMING SHOPPES, INC.
	(Registrant)
Date:   February 5, 2008	/S/ ERIC M. SPECTER
	Eric M. Specter
	Executive Vice President
	Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated February 5, 2008
99.2	Letter to Employees dated February 5, 2008
99.3	Slide Presentation dated February 5, 2008

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EX-99.1

EXHIBIT 99.1

FOR IMMEDIATE RELEASE

PRESS RELEASE

CHARMING SHOPPES, INC. ANNOUNCES

FURTHER INITIATIVES TO STREAMLINE OPERATIONS,

REDUCE EXPENSES AND IMPROVE CASH FLOW

Bensalem, PA, February 5, 2008 - Charming Shoppes, Inc., (NASDAQ-CHRS), a leading multi-brand, multi-channel specialty apparel retailer specializing in women's plus-size apparel, today announced further initiatives and actions being taken as a result of the Company’s ongoing business review and in response to the continuing weak retail and economic environment in which the Company is currently operating.  These actions are being taken in order to streamline business operations, reduce SG&A and capital expenditures, improve cash flow, and enhance shareholder value, and include:

·   The elimination of approximately 150, or 13%, of corporate and field management positions, which was completed as of January 31, 2008, and together with the Company’s announcement to relocate its Catherines home operations to Bensalem, results in an aggregate reduction of approximately 200 full-time positions;

·   A decrease of more than $40 million in the capital budget for fiscal year 2009, representing a 30% decrease from fiscal year 2008, primarily through a significant reduction in the number of planned store openings for fiscal year 2009;

·   The closing of approximately 150 underperforming stores, including approximately 100 stores at the Fashion Bug chain; and,

·   The closing of the Petite Sophisticate full-line retail concept.

Dorrit J. Bern, Chairman, Chief Executive Officer and President of Charming Shoppes, Inc. stated, “As part of our ongoing review of our operations, especially in this challenging environment, we are taking a number of additional actions to improve profitability and enhance shareholder value.

“In November 2007, we announced the execution of a number of initiatives which had been under review during the last fiscal year, including decreases in inventory levels, reductions of capital expenditures, share repurchases, and the relocation of our Catherines’ Memphis, TN operations to our Bensalem, PA offices.  Today’s announcements, in conjunction with initiatives we announced in November, will enable us to further sharpen our focus on our core businesses, reduce SG&A and capital spending, including a pull-back on new store growth, and ultimately improve cash flow.  These were difficult, but necessary actions and we are confident that by streamlining our operations, realigning our field management structure, and reducing the number of positions at our corporate headquarters, we will further strengthen Charming Shoppes’ operational and financial performance.  Today’s announcements add more emphasis and importance to many initiatives which we began in fiscal year 2008.

“Although we remain confident in Charming Shoppes’ continuing long-term growth opportunities, we have significantly pared back our fiscal year 2009 capital budget in connection with our ongoing review of operations and as a prudent measure in the current economic environment.  These reductions are in addition to the 10% decrease in the fiscal year 2008 capital budget as announced in August 2007.  Our fiscal year 2009 gross capital expenditures plan of approximately $103 million will represent a significant reduction of more than $40 million, or 30% below projected levels of $146 million for the fiscal year ending February 2, 2008.  Compared to fiscal year 2008, key elements of our 2009 capital budget include a 50% reduction in our new store openings, a 20% reduction in relocations, and reductions in infrastructure spending.  Our store openings in fiscal year 2009 are largely at our Lane Bryant retail brand, and primarily reflect lease commitments that had been entered into during the first half of fiscal 2008.”

Today’s announcement also includes the identification of approximately 150 underperforming store locations to be closed, representing a significant acceleration of the Company’s typical annual store closing program.  The closings include approximately 100 Fashion Bug locations, as well as a number of locations in each of the Company’s other retail concepts.  In a majority of cases, the closing store is in a market area supported by a number of our stores, and the Company will take advantage of opportunities for sales transfers to remaining area stores.  The Company estimates that the stores identified for closure are currently generating a pre-tax loss of approximately $6 million on an annualized basis.

Additionally, the Company announced the closing of its four-store Petite Sophisticate Retail concept, which was launched during fiscal year 2008.  Bern commented, “Although we continue to view Petite Sophisticate as an exciting growth opportunity, our more immediate priorities call for dedicating a greater focus to our core businesses.  The decision to discontinue the further development of the Petite Sophisticate full-line chain does not impact our 52 Petite Sophisticate Outlet stores, the majority of which operate in side-by-side locations with our Lane Bryant Outlet stores.”

The Company anticipates that the execution of the initiatives announced today will result in approximately $20.0 million of annualized pre-tax savings, primarily in the areas of non-store payroll and annualized losses related to the aforementioned 150 store closings.  As a result of the initiatives announced today, the Company expects to recognize one-time non-recurring pre-tax charges of approximately $17.3 million ($10.8 million after tax, or $0.09 per diluted share) related to severance, benefits and lease termination costs, including $7.0 million ($4.4 million after tax) of non-cash pre-tax charges related to the write-down of store assets. On an after-tax basis, the impact of the one-time non-recurring charges is expected to be slightly cash-flow negative.

Providing an update on the Company’s share repurchase plan, Bern stated, “During fiscal year 2008, we have repurchased a significant number of shares under our share repurchase program.  Year to date, we have repurchased approximately 24 million shares, or 19% of our beginning-of-year share count.  Additionally, in November 2007, we announced our Board of Directors had authorized an extensive $200 million share repurchase program which we intend to complete over the next several years.”

In summary, Bern said, “We remain confident in and committed to our long-term multi-brand, multi-channel strategy.  In the near-term, however, and similar to difficult actions we have taken in past retail and economic downturns, we are taking important steps to ensure a greater focus on our core businesses and on improving profitability.  As we have done in the past, we will continue to examine additional opportunities to further drive sales, profitability and shareholder value.”

At November 3, 2007, Charming Shoppes, Inc. operated 2,453 retail stores in 48 states under the names LANE BRYANT^®, FASHION BUG^®, FASHION BUG PLUS^®, CATHERINES PLUS SIZES^®, PETITE SOPHISTICATE^®, LANE BRYANT OUTLET^®, and PETITE SOPHISTICATE OUTLET^TM. Additionally, apparel, accessories, footwear and gift catalogs, including the following titles, are operated by Charming Shoppes’ Crosstown Traders:  Lane Bryant Woman^TM, Old Pueblo Traders^®, Bedford Fair^®, Willow Ridge^®, Lew Magram^®, Brownstone Studio^®, Intimate Appeal^®, Monterey Bay Clothing Company^®, Coward^® Shoe and Figi's^®.

This release contains certain forward-looking statements concerning the Company's operations, performance, and financial condition. Such forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those indicated. Such risks and uncertainties may include, but are not limited to: the failure to effectively implement the Company’s plan for consolidation of the Catherines Plus Sizes brand and a new organizational structure, the failure to implement the Company's business plan for increased profitability and growth in the Company's retail stores and direct-to-consumer segments, the failure of changes in management to achieve improvement in the Company’s competitive position, the failure to successfully implement the Company's integration of operations of, and the business plan for, Crosstown Traders, Inc., adverse changes in costs vital to catalog operations, such as postage, paper and acquisition of prospects, declining response rates to catalog offerings, failure to maintain efficient and uninterrupted order-taking and fulfillment in our direct-to-consumer business, changes in or miscalculation of fashion trends, extreme or unseasonable weather conditions, economic downturns, escalation of energy costs, a weakness in overall consumer demand, failure to find suitable store locations, increases in wage rates, the ability to hire and train associates, trade and security restrictions and political or financial instability in countries where goods are manufactured, the interruption of merchandise flow from the Company's centralized distribution facilities, competitive pressures, and the adverse effects of natural disasters, war, acts of terrorism or threats of either, or other armed conflict, on the United States and international economies. These, and other risks and uncertainties, are detailed in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the fiscal year ended February 3, 2007 and other Company filings with the Securities and Exchange Commission. Charming Shoppes assumes no duty to update or revise its forward- looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.

CONTACT:	Gayle M. Coolick
	Director of Investor Relations
	(215) 638-6955

EX-99.2

EXHIBIT 99.2

Charming Shoppes Announces Executive Leadership Appointment and Store-Related Initiatives

Dear Associates:

This morning, we made an announcement about the departure of one of our executives, and the appointment of one of our current executive leaders who has accepted an important leadership role on an interim basis.  Additionally, we announced a number of store initiatives.  First, I would like to address our executive management change.

Diane Paccione has accepted the position of Chief Executive Officer of DEB Shops, Inc.  The Company has begun a search for an appropriate successor to Diane.

Today, we have named Joe Baron, our Executive Vice President and Chief Operating Officer, to be responsible for the leadership of the Fashion Retail Group on an interim basis.  During this time, Joe will have the following executives reporting to him: Donna Desilets - Human Resources, Zig Glinski - Planning and Allocation, Keith Spirgel - Finance, Sue Dasse - Catherines Stores, Gary Thompson - Fashion Bug Stores, Susan Reiman - Outlets Stores, Bob Baker - Catherines, Melissa Novell – Fashion Bug, Jeff Elliott - Outlets, and Lynn Derry – Finishing Touches.

Since 2002, Joe served us as Executive Vice President and Chief Operating Officer.  His career in retailing has spanned over 35 years, including many management and executive management positions during his 30 year career at Sears, Roebuck & Co.

In the last six years, Joe has made many strong contributions to Charming Shoppes, including leading the development and launch of our outlet channel business, and building a platform which has supported the strong growth of our e-commerce business.  Most recently, we called upon Joe’s leadership and organizational talents to transition our direct-to-consumer business through an executive leadership change, which contributed to the successful launch of the Lane Bryant Woman catalog, and improvements in our core catalog businesses.

Through his time at Charming Shoppes, Joe has worked closely with many of our associates.  Joe has accepted his new role with great enthusiasm, and is looking forward to renewing and continuing strong relationships with so many of you, as well as beginning new affiliations within the newly structured FRG.

Secondly, I would like to discuss our external press release announcement made this morning relating to our Company’s store groups.

Following an ongoing review of our operations, we are announcing a number of actions in order to improve our profitability as we operate in this weak retail environment.

These were difficult, but necessary, actions and we are confident that by streamlining our operations, we will further strengthen Charming Shoppes’ operational and financial performance, and better position the Company for long-term growth and success in this difficult environment.

The initiatives announced today include:

·   Approximately 150 store closings;

·   The closing of our Petite Sophisticate full-line chain; and

·   A significant decrease in the capital budget, including a reduction in the number of planned store openings for fiscal year 2009.

We have identified approximately 150 unprofitable store locations to be closed.  The closings, which will be executed throughout the year, include about 100 Fashion Bug locations, 40 Lane Bryant stores, and 10 Catherines stores.  In a majority of cases, the closing store is in a market area supported by a number of our stores, and we will make every effort to accommodate associates from closed stores to other area stores.

We have also announced the closing of our four-store Petite Sophisticate Retail concept, which was launched during fiscal year 2008.  Although we continue to view Petite Sophisticate as an exciting growth opportunity, our more immediate priorities call for dedicating a greater focus to our core businesses.  This decision does not impact our 52 Petite Sophisticate Outlet stores, the majority of which operate in side-by-side locations with our Lane Bryant Outlet stores.

Key elements of our 2008 capital plan include a meaningful reduction to our plan for new store openings and relocations, as well as reductions in infrastructure spending.  Of course, as usual, we continue to identify ideas on how to contain our operating expenditures.

Joe Baron and I will be hosting a Town Hall Up2Date Live today on Tuesday, February 5, 2008 at 3:00pm and 3:45pm.  Additionally, a 4:30pm session has been added to the schedule for our Fashion Retail Group associates.  I invite you to come prepared with your questions, on any topic, ranging from executive changes, to the current business environment, to an update on our efforts in streamlining our operations.

I would like to personally thank you for your continued support as we build our multi-brand, multi-channel business model.

Sincerely,

 

Dorrit J. Bern

EX-99.3

EXHIBIT 99.3

Our Business

Dorrit Bern - Chairman, CEO and President

Joe Baron - Chief Operating Officer and EVP

February 5, 2008

>The Economy and Our Business

>How Charming Shoppes is Reacting

>Streamlining Our Operations

>Stores and 2008 Capital Plans

>Fashion Retail Group

>Our Goals for 2008

Today’s Agenda

This presentation contains certain forward-looking statements concerning the Company's operations,
performance, and financial condition. Such forward-looking statements are subject to various risks and
uncertainties that could cause actual results to differ materially from those indicated. Such risks and
uncertainties may include, but are not limited to:  the failure to effectively implement the Company’s plan for
consolidation of the Catherines Plus Sizes brand and a new organizational structure, the failure to generate a
positive response to the Company’s new Lane Bryant catalog and Lane Bryant credit card program, the failure
to implement the Company's business plan for increased profitability and growth in the Company's retail stores
and direct-to-consumer segments, the failure to successfully implement the Company's expansion of Cacique
through new sto
re formats, the failure of changes in management to achieve improvement in the Company’s
competitive position, the failure to successfully implement the Company's integration of operations of, and the
business plan for, Crosstown Traders, Inc., adverse changes in costs vital to catalog operations, such as
postage, paper and acquisition of prospects, declining response rates to catalog offerings, failure to maintain
efficient and uninterrupted order-taking and fulfillment in our direct-to-consumer business, changes in or
miscalculation of fashion trends, extreme or unseasonable weather conditions, economic downturns,
escalation of energy costs, a weakness in overall consumer demand, failure to find suitable store locations,
increases in wage rates, the ability to hire and train associates, trade and security restrictions and political or
financial instability in countries where goods are manufactured, the interruption of merchandise flow from the
Company's centralized distribu
tion facilities, competitive pressures, and the adverse effects of natural
disasters, war, acts of terrorism or threats of either, or other armed conflict, on the United States and
international economies. These, and other risks and uncertainties, are detailed in the Company's filings with
the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the fiscal
year ended February 3, 2007 and other Company filings with the Securities and Exchange Commission.
Charming Shoppes assumes no duty to update or revise its forward- looking statements even if experience or
future changes make it clear that any projected results expressed or implied therein will not be realized.

Forward-Looking Statements

The Economy and Our
Business

The Realities

•Recession?

>Whether the economists believe we are or are not in a
   recession, our customer believes we are and has changed her
   buying behavior

•Gasoline Costs are projected to reach $3.50/gallon by this
    Spring

•The Credit Crunch continues

•The Retail Apparel Industry

>Consumers are viewing apparel purchases as discretionary

>Nearly every apparel retailer has announced difficult
   performance and/or measures to address this environment

Source:  FactSet Research Systems Inc. as of January 17, 2006,

First Call estimates, public news sources and SEC filings.

STOCK PRICE PERFORMANCE SINCE JULY 1, 2007

Source:  FactSet Research Systems Inc. as of January 17, 2008

First Call estimates, public news sources and SEC filings.

(a) Reflects comparable store sales for the nine weeks ended January 5, 2008.

2006A - 2007E
EBITDA Margin ∆:

  (0.2%)           2.0%                0.7%            (1.1%)           (2.8%)         (2.2%)           (1.6%)          (1.4%)           (4.0%)            (2.2%)         (3.2%)          (4.7%)

Dec. 2007

Same Store Sales

  (2.0%)          18.7%             (6.0%)           (2.0%)           (8.0%)         (8.0%)           (9.4%)             NA               (7.0%)           (2.8%)         (3.5%)             NA

(a)

(a)

•Most apparel retailers have experienced a significant
decline in share price since July 2007, with negative
same store sales impacting margins

Recent Stock Price and Operating Performance
of Selected Retailers

Retailers Are Taking Action

•Ann Taylor

•JC Penney

•Eddie Bauer

•Pacific Sunwear

•Sears

•Talbots

•Home Depot

How Charming Shoppes Is
Reacting

How Charming Shoppes Is
Reacting

•These are difficult but necessary actions we
   need to take in these challenging times.  

•We are:

>Not back-filling a number of open positions

>Minimizing layoffs

>Cutting back on capital projects

>Decreasing operating expenses

>Closing unprofitable stores

2002

•Actions taken in 2002…

>Closing of underperforming stores

>Focus on core businesses

>Manage expenses

>Manage inventory

2008

•Actions taken in 2008…

>Closing of underperforming stores

>Focus on core businesses

>Manage expenses

>Manage inventory

Our stock price decreased to a low of
$2.76 in early 2003, following
disappointing sales trends… 

…and rebounded strongly, to $15, when
our sales trends improved.

Stores and 

2008 Capital Plans

Stores and 2008 Capital Plans

•We announced this morning the closing of
    approximately 150 stores, including about 100
    Fashion Bug Stores, 40 at Lane Bryant and 10
    at Catherines

•We will be closing the Petite Sophisticate
    full-line retail stores

•We have decreased our 2008 Capital budget
    by over $40 million, primarily through a
    reduced store expansion plan

The Fashion Retail Group

•Joe Baron will be our interim leader of
    the FRG

•24 Catherines associates will join us in
   Bensalem on 2/18/08; 6 more will join us
   on 3/17/08

•Our Memphis facility will close on 3/31/08

2008 Goals

2008 Goals

•Successful relocation of Catherines to
   Bensalem

•Formation of the Fashion Retail Group

•Comp store sales improvements

•Stabilization of margins through an integrated
   and innovative marketing approach

•Return to sustainable profit levels