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) October 6, 2004
CHARMING SHOPPES, INC.
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(Exact name of registrant as specified in its charter)
PENNSYLVANIA 000-07258 23-1721355
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
450 WINKS LANE, BENSALEM, PA 19020
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (215) 245-9100
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NOT APPLICABLE
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(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)
[ ] 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 1.01 Entry Into a Material Definitive Agreement.
The information included under "Item 2.03. Creation of a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet Arrangement of a
Registrant." below is incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
(a)(1)-(3) As used herein, the term "the Company" refers to Charming
Shoppes, Inc. (the "Registrant") and, where applicable, its wholly-owned
subsidiaries.
On October 6, 2004, FB Distro Distribution Center, LLC, a wholly-owned
subsidiary of the Registrant, borrowed $13,000,000 under a note (the "Note")
with BankAtlantic Commercial Mortgage Capital, LLC. The Note is secured by a
mortgage (the "Mortgage") on real property located at the Company's distribution
center facility in Greencastle, Indiana and an Assignment of Lease and Rents and
Security Agreement related to the facility.
The interest rate on the Note is 6.07%. Repayment of principal is based on
a 15-year amortization schedule, with a balloon payment in 10 years. If the note
is not repaid at the end of 10 years, the interest rate increases to the greater
of: (1) the initial rate (6.07%) plus 5.0%, or (2) the Treasury Rates (as
defined in the Note) plus 5.0%. The Note may be prepaid after 2-1/2 years upon
the payment of a premium or, upon certain other events, without the payment of a
premium.
In connection with the borrowing, the Registrant executed Guaranties and an
Indemnification Agreement for obligations under the Mortgage and Note with
respect to the mortgaged property. The total liability under these Guaranties
and the Indemnification Agreement will not exceed 125% of the outstanding
principal balance of the Note.
The Note and Mortgage contain standard representations, covenants, and
events of default. Events of default include the failure to pay debt service,
failure to pay taxes, and breach of representation or warranty. Upon an uncured
event of default, amounts due under the Note will become immediately due and
payable.
The proceeds from the borrowing will be used to repay the scheduled
maturities of other debt and for other general corporate purposes.
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.
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(Registrant)
Date October 8, 2004
/S/ ERIC M. SPECTER
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Eric M. Specter
Executive Vice President
Chief Financial Officer