----

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| Delaware(State or other jurisdiction of incorporation or organization) 1706 Washington Ave., St. Louis, Missouri(Address of principal executive offices) | 43-1256674(I.R.S. Employer Identification No.) 63103(Zip Code) |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|

| Title of each classCommon Stock, par value $0.40 per share | Name of each exchange on which registeredNew York Stock Exchange |
|------------------------------------------------------------|------------------------------------------------------------------|

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| TABLE OF CONTENTS |
|-------------------|
| PART I            |   |   |   |   |
|              |   |   |   |   |
| Item 1.           |   | Business |   | 3 |
| Item 1A.          |   | Risk Factors |   | 8 |
| Item 1B.          |   | Unresolved Staff Comments |   | 11 |
| Item 2.           |   | Properties |   | 12 |
| Item 3.           |   | Legal Proceedings |   | 12 |
|              |   |   |   |   |
| PART II           |   |   |   |   |
|              |   |   |   |   |
| Item 5.           |   | Market for Registrant's Common Equity, Related Stockholder |   |   |
|              |   |   | Matters and Issuer Purchases of Equity Securities |   | 13 |
| Item 6.           |   | Selected Consolidated Financial Data |   | 16 |
| Item 7.           |   | Management's Discussion and Analysis of |   |   |
|              |   |   | Financial Condition and Results of Operations |   | 18 |
| Item 7A.          |   | Quantitative and Qualitative Disclosures About |   |   |
|              |   |   | Market Risk |   | 29 |
| Item 8.           |   | Financial Statements and Supplementary Data |   | 30 |
| Item 9.           |   | Changes in and Disagreements with Accountants |   |   |
|              |   |   | on Accounting and Financial Disclosures |   | 67 |
| Item 9A.          |   | Controls and Procedures |   | 67 |
|              |   |   |   |   |
| PART III          |   |   |   |   |
|              |   |   |   |   |
| Item 10.          |   | Directors, Executive Officers and Corporate Governance |   | 69 |
| Item 11.          |   | Executive Compensation |   | 69 |
| Item 12.          |   | Security Ownership of Certain Beneficial Owners |   |   |
|              |   |   | and Management and Related Stockholder Matters |   | 69 |
| Item 13.          |   | Certain Relationships and Related Transactions, and Director |   |   |
|              |   |   | Independence |   | 69 |
| Item 14.          |   | Principal Accounting Fees and Services |   | 70 |
|              |   |   |   |   |
| PART IV           |   |   |   |   |
|              |   |   |   |   |
| Item 15.          |   | Exhibits and Financial Statement Schedules |   | 70 |
|              |   | Signatures |   | 76 |

Item

Item

| o   | Difficulty in integrating and managing personnel, financial reporting and other systems used by the Bella Pictures® business into the Company; |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| o   | The failure of the Bella Pictures® business to perform in accordance with the Company’s expectations; and |
|---------------|----------------------------------------------------------------------------------------------------------------------|

| o   | Failure to achieve anticipated synergies between the Company’s business and the Bella Pictures® business. |
|---------------|----------------------------------------------------------------------------------------------------------------------|

Item

Item

|                      |   | APPROXIMATE                                                                                                                         |   |                                                                                              |   |      |   |
|---------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------|--------|-----------|--------|
|                      |   | AREA IN                                                                                                                             |   |                                                                                              |   | OWNERSHIP |   |
| LOCATION                  |   | SQUARE FEET                                                                                                                         |   | PRIMARY USES                                                                                      |   | OR LEASE  |   |
| Matthews, North Carolina  |   |                  860,000                       |   | Unoccupied Administration and Portrait processing facility (includes 696,000 square feet in land) |   | Owned     | (1)    |
| Charlotte, North Carolina |   |                  372,000                       |   | Administration, Warehousing and Portrait processing (includes 315,000 square feet in land)        |   | Owned     |   |
| Charlotte, North Carolina |   |                  348,000                       |   | Undeveloped, industrial land                                                                      |   | Owned     | (1)    |
| St. Louis, Missouri       |   |                  341,000                       |   | Headquarters, Administration and Portrait processing (includes 31,000 square feet in land)        |   | Owned     |   |
| St. Louis, Missouri       |   |                  159,000                       |   | Parking Lots                                                                                      |   | Owned     |   |
| St. Louis, Missouri       |   |                    53,000            |   | Warehousing                                                                                       |   | Leased    | (2)    |
| Charlotte, North Carolina |   |                    51,000            |   | Parking Lots                                                                                      |   | Owned     |   |
| Sandy City, Utah          |   |                    41,000            |   | Unoccupied Administration (includes 24,000 square feet in land)                                   |   | Owned     | (3)    |
| Brampton, Ontario         |   |                      5,000 |   | Administration                                                                                    |   | Leased    | (4)    |

| (1) |   | Properties are not in use.  See Note 7 to the Notes to Consolidated Financial Statements for further discussion. |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------|
| (2) |   | Lease term expires on July 31, 2018.                                                                                       |
| (3) |   | Property is held for sale.  See Note 7 to the Notes to Consolidated Financial Statements for further discussion. |
| (4) |   | Lease term expires on June 30, 2015.                                                                                       |

| NUMBER                                                                                                                                                                      |   |                          |                             |                                                  |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|----------------------------------|-------------------------------------------------------|
| OF STUDIOS                                                                                                                                                                  |   | COUNTRY                       |                             | LICENSOR/LESSOR                                       |
|                 1,536                                                                       |   | United States and Puerto Rico |                             | Walmart                                               |
|                    859                                                       |   | United States and Puerto Rico |                             | Sears                                                 |
|                             150 |   | United States                 |                             | Toys "R" Us                                           |
|                    260                                                       |   | Canada                        |                             | Walmart Canada Corp.                                  |
|                    110                                                       |   | Canada                        |                             | Sears Canada, Inc.                                    |
|                    108                                                       |   | Mexico                        |                             | Nueva Walmart de Mexico, S, de R.L. de C.V.           |
|                      61                                            |   | United States studios not     |                             | Third parties - generally leased for at least 3 years |
|                                                                                                                                                                        |   |                          | in Walmart, Sears or Toys "R" Us |                                                  |   | with some having renewal options |

Item

| Item 5. | Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
|---------|--------------------------------------------------------------------------------------------------------------|

| FISCAL YEAR 2010          |   |   |   |   |   |   |   |     |   |
|---------------------------|--------|--------|--------|--------|--------|--------|--------|----------|--------|
| (ending February 5, 2011) |   | HIGH   |   |   | LOW    |   |   | DIVIDEND |   |
| First Quarter             |   | $      | 28.63  |   |   | $      | 12.57  |     |   | $ | 0.16 |   |
| Second Quarter            |   |   | 31.91  |   |   |   | 21.31  |     |   |   | 0.25 |   |
| Third Quarter             |   |   | 28.03  |   |   |   | 18.73  |     |   |   | 0.25 |   |
| Fourth Quarter            |   |   | 30.80  |   |   |   | 19.43  |     |   |   | 0.25 |   |

| FISCAL YEAR 2009          |   |   |   |   |   |   |   |     |   |
|---------------------------|--------|--------|--------|--------|--------|--------|--------|----------|--------|
| (ending February 6, 2010) |   | HIGH   |   |   | LOW    |   |   | DIVIDEND |   |
| First Quarter             |   | $      | 10.86  |   |   | $      | 6.00   |     |   | $ | 0.16 |   |
| Second Quarter            |   |   | 18.80  |   |   |   | 9.90   |     |   |   | 0.16 |   |
| Third Quarter             |   |   | 18.78  |   |   |   | 9.99   |     |   |   | 0.16 |   |
| Fourth Quarter            |   |   | 15.00  |   |   |   | 11.60  |     |   |   | 0.16 |   |

|         | 2006                                                                                 | 2007                                                                                       | 2008                                                                                                              | 2009                                                                                                              | 2010                                                                                                        | 2011                                                                                 |
|--------------|--------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------|
| CPY          |              100.00 |               296.16 |                 115.14            |                   43.91 |                  84.56 |              131.32 |
| S&P 500  |              100.00 |               114.32 |                 111.80            |                   69.24 |                  91.90 |              112.03 |
| Russell 2000 |              100.00 |               110.40 |                   99.73 |                   63.36 |                  87.13 |              114.28 |

|                                  |   |                 |    |   |           |   |   | Total Number of                     |   |   | Maximum Number                   |   |
|---------------------------------------|--------|----------------------|---------|--------|----------------|--------|--------|-------------------------------------|--------|--------|----------------------------------|--------|
|                                  |   |                 |    |   |           |   |   | Shares Purchased                    |   |   | of Shares that May               |   |
|                                  |   | Total Number of      |    |   | Average Price  |   |   | as Part of Publicly Announced Plans |   |   | Yet Be Purchased Under the Plans |   |
| Period                                |   | Shares Purchased (1) |    |   | Paid per Share |   |   | Programs (1)                        |   |   | or Programs (2)                  |   |
| November 14, 2010 - December 13, 2010 |   |                 | -       |   |           | $      | -      |                                |   |   | -                                |   |   |   | 1,000,000 |   |
|                                  |   |                 |    |   |           |   |   |                                |   |   |                             |   |   |   |   |   |
| December 14, 2010 - January 13, 2011  |   |                 | 289,049 |   |           |   | 22.33  |                                |   |   | 289,049                          |   |   |   | 710,951 |   |
|                                  |   |                 |    |   |           |   |   |                                |   |   |                             |   |   |   |   |   |
| January 14, 2011 - February 5, 2011   |   |                 | 35,667  |   |           |   | 20.77  |                                |   |   | 35,667                           |   |   |   | 675,284 |   |
|                                  |   |                 |    |   |           |   |   |                                |   |   |                             |   |   |   |   |   |
| Total                                 |   |                 | 324,716 |   |           | $      | 22.19  |                                |   |   | 324,716                          |   |   |   |   |   |
|                                  |   |                 |    |   |           |   |   |                                |   |   |                             |   |   |   |   |   |

| (1)   | On August 25, 2010, the Company's Board of Directors authorized a 1.0 million share open market repurchase program.  The expiration date of the program is August 25, 2011. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | Subsequent to the 2010 fiscal year end, the Company repurchased an additional 52,937 shares of its common stock at an average price of $20.54 per share.  The remaining maximum number of shares that may yet be purchased under the program as of April 20, 2011, is 622,347 shares. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Item

| in thousands except share and per share data                           |   | 2010   |    |   | 2009   |   |    | 2008   |   |   | 2007    |   |   | 2006   |    |
|------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |
| STATEMENT OF OPERATIONS (1)                                            |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |
| Net sales                                                              |   | $      | 407,035 |   |   | $      | 422,371 |   |   | $      | 462,548 |   |   | $      | 423,429 |   |   | $ | 292,973 |   |
| Cost of sales (exclusive of depreciation and amortization shown below) |   |   | 28,263  |   |   |   | 30,626  |   |   |   | 43,280  |   |   |   | 47,135  |   |   |   | 30,211 |   |
| Selling, general and administrative expenses                           |   |   | 337,490 |   |   |   | 339,138 |   |   |   | 377,310 |   |   |   | 326,568 |   |   |   | 218,282 |   |
| Depreciation and amortization                                          |   |   | 17,962  |   |   |   | 22,740  |   |   |   | 29,432  |   |   |   | 27,291  |   |   |   | 16,861 |   |
| Other charges and impairments (2)                                      |   |   | 5,092   |   |   |   | 3,294   |   |   |   | 13,557  |   |   |   | 7,695   |   |   |   | 1,241 |   |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Income (loss) from continuing operations                               |   |   | 18,228  |   |   |   | 26,573  |   |   |   | (1,031  | )      |   |   | 14,740  |   |   |   | 26,378 |   |
| Interest expense, net (3)                                              |   |   | 3,843   |   |   |   | 6,936   |   |   |   | 8,527   |   |   |   | 8,818   |   |   |   | 1,815 |   |
| Other income (expense), net (4)                                        |   |   | 929     |   |   |   | (44     | )      |   |   | 190     |   |   |   | 175     |   |   |   | 1,031 |   |
| Income tax expense (benefit)                                           |   |   | 3,413   |   |   |   | 5,796   |   |   |   | (2,644  | )      |   |   | 2,080   |   |   |   | 9,164 |   |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income (loss) from continuing operations                           |   |   | 11,901  |   |   |   | 13,797  |   |   |   | (6,724  | )      |   |   | 4,017   |   |   |   | 16,430 |   |
| Net loss from discontinued operations, net of tax (1)                  |   |   | -       |   |   |   | -       |   |   |   | (961    | )      |   |   | (441    | ) |   |   | (103 | ) |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income (loss)                                                      |   |   | 11,901  |   |   |   | 13,797  |   |   |   | (7,685  | )      |   |   | 3,576   |   |   |   | 16,327 |   |
| Net loss attributable to noncontrolling interest                       |   |   | (7      | )      |   |   | -       |   |   |   | -       |   |   |   | -       |   |   |   | - |   |
| Net income (loss) attributable to CPI Corp.                            |   | $      | 11,908  |   |   | $      | 13,797  |   |   | $      | (7,685  | )      |   | $      | 3,576   |   |   | $ | 16,327 |   |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| SHARE AND PER SHARE DATA (1)                                           |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income (loss) from continuing operations - diluted (5)             |   | $      | 1.64    |   |   | $      | 1.97    |   |   | $      | (1.03   | )      |   | $      | 0.63    |   |   | $ | 2.58 |   |
| Net income (loss) from continuing operations - basic (5)               |   | $      | 1.64    |   |   | $      | 1.97    |   |   | $      | (1.03   | )      |   | $      | 0.63    |   |   | $ | 2.59 |   |
| Net income (loss) attibutable to CPI Corp. - diluted (5)               |   | $      | 1.64    |   |   | $      | 1.97    |   |   | $      | (1.18   | )      |   | $      | 0.56    |   |   | $ | 2.56 |   |
| Net income (loss) attibutable to CPI Corp. - basic (5)                 |   | $      | 1.64    |   |   | $      | 1.97    |   |   | $      | (1.18   | )      |   | $      | 0.56    |   |   | $ | 2.57 |   |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Dividends                                                              |   | $      | 0.91    |   |   | $      | 0.64    |   |   | $      | 0.64    |   |   | $      | 0.64    |   |   | $ | 0.64 |   |
| Average shares outstanding - diluted (5)                               |   |   | 7,272   |   |   |   | 7,020   |   |   |   | 6,510   |   |   |   | 6,416   |   |   |   | 6,376 |   |
| Average shares outstanding - basic (5)                                 |   |   | 7,257   |   |   |   | 6,993   |   |   |   | 6,510   |   |   |   | 6,391   |   |   |   | 6,353 |   |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| CASH FLOW DATA (continuing operations only)                            |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Net cash provided by operating activities                              |   | $      | 39,067  |   |   | $      | 31,289  |   |   | $      | 12,663  |   |   | $      | 39,872  |   |   | $ | 37,993 |   |
| Net cash (used in) provided by financing activities                    |   | $      | 43,735  |   |   | $      | (33,494 | )      |   | $      | (13,419 | )      |   | $      | 90,788  |   |   | $ | (43,567 | ) |
| Net cash used in investing activities                                  |   | $      | (8,821  | )      |   | $      | (2,876  | )      |   | $      | (33,488 | )      |   | $      | (97,653 | ) |   | $ | (2,358 | ) |
|                                                                   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Capital expenditures                                                   |   | $      | 13,490  |   |   | $      | 5,234   |   |   | $      | 36,074  |   |   | $      | 14,884  |   |   | $ | 2,760 |   |

| in thousands                                                     |   | 2010   |    |   | 2009   |   |    | 2008   |   |   | 2007    |   |   | 2006   |    |
|------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|
|                                                             |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |
| BALANCE SHEET                                                    |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |
|      Cash and cash equivalents               |   | $      | 5,363   |   |   | $      | 18,913  |   |   | $      | 23,665  |   |   | $      | 59,177  |   |   | $ | 26,294 |   |
|      Current assets                          |   |   | 30,089  |   |   |   | 53,555  |   |   |   | 61,480  |   |   |   | 92,835  |   |   |   | 55,164 |   |
|      Net fixed assets                        |   |   | 35,998  |   |   |   | 34,169  |   |   |   | 50,887  |   |   |   | 56,280  |   |   |   | 26,693 |   |
|      Goodwill and intangible assets (6)      |   |   | 60,736  |   |   |   | 60,380  |   |   |   | 61,665  |   |   |   | 62,956  |   |   |   | 512 |   |
|      Other assets                            |   |   | 16,977  |   |   |   | 18,487  |   |   |   | 18,823  |   |   |   | 27,152  |   |   |   | 11,379 |   |
|      Total assets                            |   |   | 143,800 |   |   |   | 166,591 |   |   |   | 192,855 |   |   |   | 239,223 |   |   |   | 93,748 |   |
|      Current liabilities                     |   |   | 49,203  |   |   |   | 62,432  |   |   |   | 55,010  |   |   |   | 83,051  |   |   |   | 49,407 |   |
|      Long-term debt, less current maturities |   |   | 48,900  |   |   |   | 57,855  |   |   |   | 104,578 |   |   |   | 105,728 |   |   |   | 8,333 |   |
|      Other liabilities                       |   |   | 31,427  |   |   |   | 36,116  |   |   |   | 32,432  |   |   |   | 33,470  |   |   |   | 23,209 |   |
|      Stockholders' equity (5)                |   |   | 14,270  |   |   |   | 10,188  |   |   |   | 835     |   |   |   | 16,974  |   |   |   | 12,799 |   |

| (1)   | The following business areas were classified as discontinued operations in the years indicated.  The financial statements for the periods prior to the classification were reclassified to reflect these changes: |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | In 2008, Portrait Gallery and E-Church operations. |
|---------------|----------------------------------------------------|

| -   | In 2007, the UK Operations which were acquired in connection with the PCA Acquisition. |
|---------------|----------------------------------------------------------------------------------------|

| (2)   | Other charges and impairments: |
|-----------------|--------------------------------|

| in thousands                                                                           |   | 2010   |   |   | 2009   |   |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|----------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Impairment charges (a)                                                                 |   | $      | 1,871  |   |   | $      | 300    |   |   | $      | 739    |   |   | $      | -      |   |   | $ | - |   |
| Kiddie Kandids integration costs (b)                                                   |   |   | 1,335  |   |   |   | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |
| Severance and related costs (c)                                                        |   |   | 538    |   |   |   | 970    |   |   |   | 2,046  |   |   |   | 2,035  |   |   |   | 878 |   |
| Bella Pictures® Acquisition costs (d)                                             |   |   | 472    |   |   |   | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |
| Other transition related costs - PCA Acquisition (e)                                   |   |   | 388    |   |   |   | 527    |   |   |   | 1,255  |   |   |   | 2,817  |   |   |   | - |   |
| Gain on sale of Brampton facility (f)                                                  |   |   | (1,473 | )      |   |   | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |
| Sears fees related to the settlement of the previous license   agreement (g) |   |   | -      |   |   |   | -      |   |   |   | 7,527  |   |   |   | 2,500  |   |   |   | - |   |
| Proxy contest fees (h)                                                                 |   |   | -      |   |   |   | 871    |   |   |   | -      |   |   |   | -      |   |   |   | - |   |
| Other  (i)                                                                   |   |   | 1,961  |   |   |   | 626    |   |   |   | 1,990  |   |   |   | 343    |   |   |   | 363 |   |
|                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Other Charges and Impairments                                                    |   | $      | 5,092  |   |   | $      | 3,294  |   |   | $      | 13,557 |   |   | $      | 7,695  |   |   | $ | 1,241 |   |
|                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

|  (a) |   | Consists primarily of 2010, 2009 and 2008 impairment charges related to the Matthews, North Carolina facility.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|-----------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  (b) |   | Relates to certain integration costs incurred in connection with the Kiddie Kandids, LLC asset acquisition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|  (c) |   | Consists principally of expenses and related costs for employee severance, retirements and repositioning.  Specifically, in 2008 and 2007, the cost primarily related to the PCA Acquisition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|  (d) |   | Relates to certain costs incurred in connection with the Bella Pictures® Acquisition, primarily related to legal and consulting fees.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|  (e) |   | Consists of integration-related costs relative to the PCA Acquisition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|  (f) |   | Represents the gain on sale of the Brampton, Ontario facility in 2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|  (g) |   | Consists of certain fees and charges related to the settlement of the previous Sears license agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|  (h) |   | Relates to certain fees incurred in connection with the proxy contest in 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|  (i) |   | Costs in 2010 primarily related to legal expense incurred in connection with the Chrissy Larkin vs. CPI Corp. case and the write-off of debt fees related to the Company’s former credit facility as a result of its new revolving credit facility; offset in part by an early termination fee received from Walmart in relation to certain early PMPS studio closures.  Costs in 2009 primarily related to net legal expense incurred in connection with the settlement of the Picture Me Press LLC vs. Portrait Corporation of America case.  Costs in 2008 primarily related to legal expense incurred for the settlement of the Portraits International of the Southwest vs. CPI Corp. case and in connection with the Picture Me Press LLC vs. Portrait Corporation of America case.  Costs in 2007 primarily related to the write-off of software that is no longer used in the business.  Costs in 2006 represent professional service expense in connection with a strategic alternative review and the write-off of certain legacy equipment that is no longer used in the business. |

| (3)    |   | In 2010, 2009, 2008 and 2007, includes (income) expense of ($2.0 million), ($1.5 million), $617,000 and $2.9 million, respectively, in connection with marking the interest rate swap agreement to its market value.  The interest rate swap agreement expired on September 17, 2010.                                                                                                                                                                                                                                                                                                                                                     |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (4)    |   | In 2010, the Company recorded an $803,000 translation gain related to intercompany balances that are payable in the foreseeable future. In 2004, the Company recorded accrued lease liability obligations relating to its lease guarantees on certain of Prints Plus’ retail stores.  As the total guarantee related to these leases had decreased with the passage of time, the payment of rents by Prints Plus and the settlement by the Company of certain leases rejected in bankruptcy, the related liability was reduced by $887,000 in 2006 to reflect management’s revised estimate of remaining potential loss. |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (5)    |   | The Company recorded the repurchase of 1,658,607 shares of common stock for $32.4 million in 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (6)    |   | In connection with the Bella Pictures® Acquisition in 2010, the Company acquired a tradename and additional goodwill. At the time of the PCA Acquisition in 2007, the Company acquired a host agreement and customer list with Walmart and additional goodwill.  See Note 8 to the Notes to Consolidated Financial Statements for further discussion.                                                                                                                                                                                                                                                                                |

Item

|                                             |   | 2010   |   | 2009   |   | 2008   |   |
|--------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|
|                                             |   |   |   |   |   |   |   |
| Within Walmart stores:                           |   |   |   |   |   |   |   |
| United States and Puerto Rico                    |   |   | 1,536  |   |   | 1,549  |   |   | 1,642 |   |
| Canada                                           |   |   | 260    |   |   | 260    |   |   | 259 |   |
| Mexico                                           |   |   | 108    |   |   | 114    |   |   | 118 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |
| Within Sears stores:                             |   |   |   |   |   |   |   |   |   |   |
| United States and Puerto Rico                    |   |   | 859    |   |   | 871    |   |   | 887 |   |
| Canada                                           |   |   | 110    |   |   | 110    |   |   | 110 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |
| Within Babies "R" Us stores in the United States |   |   | 150    |   |   | -      |   |   | - |   |
|                                             |   |   |   |   |   |   |   |   |   |   |
| Locations not within above host stores           |   |   | 61     |   |   | 31     |   |   | 30 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |
| Total                                            |   |   | 3,084  |   |   | 2,935  |   |   | 3,046 |   |
|                                             |   |   |   |   |   |   |   |   |   |   |

| in thousands, except per share data                                                  |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|--------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
|                                                                                 |   |   |    |   |   |   |    |   |   |
| Net sales                                                                            |   | $      | 407,035 |   |   | $      | 422,371 |   |   | $ | 462,548 |   |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Cost and expenses:                                                                   |   |   |    |   |   |   |    |   |   |   |   |   |
| Cost of sales (exclusive of depreciation and amortization shown below)               |   |   | 28,263  |   |   |   | 30,626  |   |   |   | 43,280 |   |
| Selling, general and administrative expenses                                         |   |   | 337,490 |   |   |   | 339,138 |   |   |   | 377,310 |   |
| Depreciation and amortization                                                        |   |   | 17,962  |   |   |   | 22,740  |   |   |   | 29,432 |   |
| Other charges and impairments                                                        |   |   | 5,092   |   |   |   | 3,294   |   |   |   | 13,557 |   |
|                                                                                 |   |   | 388,807 |   |   |   | 395,798 |   |   |   | 463,579 |   |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Income (loss) from continuing operations                                             |   |   | 18,228  |   |   |   | 26,573  |   |   |   | (1,031 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Interest expense                                                                     |   |   | 3,860   |   |   |   | 7,030   |   |   |   | 8,529 |   |
| Interest income                                                                      |   |   | 17      |   |   |   | 94      |   |   |   | 2 |   |
| Other income (expense), net                                                          |   |   | 929     |   |   |   | (44     | )      |   |   | 190 |   |
| Income (loss) from continuing operations before income tax expense (benefit)         |   |   | 15,314  |   |   |   | 19,593  |   |   |   | (9,368 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Income tax expense (benefit)                                                         |   |   | 3,413   |   |   |   | 5,796   |   |   |   | (2,644 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income (loss) from continuing operations                                         |   |   | 11,901  |   |   |   | 13,797  |   |   |   | (6,724 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Net loss from discontinued operations, net of income tax benefit                     |   |   | -       |   |   |   | -       |   |   |   | (961 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income (loss)                                                                    |   |   | 11,901  |   |   |   | 13,797  |   |   |   | (7,685 | ) |
| Net loss attributable to noncontrolling interest                                     |   |   | (7      | )      |   |   | -       |   |   |   | - |   |
| NET INCOME (LOSS) ATTRIBUTABLE TO CPI CORP.                                          |   | $      | 11,908  |   |   | $      | 13,797  |   |   | $ | (7,685 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| NET INCOME (LOSS) PER COMMON SHARE                                                   |   |   |    |   |   |   |    |   |   |   |   |   |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Net income (loss) per share from continuing operations - diluted                     |   | $      | 1.64    |   |   | $      | 1.97    |   |   | $ | (1.03 | ) |
| Net loss per share from discontinued operations - diluted                            |   |   | -       |   |   |   | -       |   |   |   | (0.15 | ) |
| Net income (loss) per share attibutable to CPI Corp. - diluted                       |   | $      | 1.64    |   |   | $      | 1.97    |   |   | $ | (1.18 | ) |
|                                                                                 |   |   |    |   |   |   |    |   |   |   |   |   |
| Weighted average number of common and common equivalent shares outstanding - diluted |   |   | 7,272   |   |   |   | 7,020   |   |   |   | 6,510 |   |

| ·   | Net sales for 2010 decreased $15.4 million, or 4%, to $407.0 million from the $422.4 million reported in 2009.  Excluding the positive impacts of net store openings ($15.3 million), foreign currency translation ($4.9 million), E-commerce ($1.5 million) and other items totaling $200,000, comparable same-store sales decreased approximately 9% from the prior year.  The Bella Pictures® Acquisition on January 26, 2011, did not materially affect the Company’s 2010 net sales. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Cost of sales, excluding depreciation and amortization expense, was $28.3 million, $30.6 million, and $43.3 million in 2010, 2009 and 2008, respectively. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Selling, general and administrative (“SG&A”) expense was $337.5 million, $339.1 million and $377.3 million for fiscal years 2010, 2009, and 2008, respectively.  The decrease in 2010 was primarily due to reductions in SPS and PMPS studio employment costs from improved scheduling, selected operating hour reductions and studio closures, reduced advertising costs, a decline in host commission expense due to lower sales levels and a reduction in corporate bonuses for fiscal 2010.  These decreases were offset significantly by costs associated with the newly opened Kiddie Kandids studios, increased expenses amortized as the result of a higher level of stock-based compensation performance awards made for the 2009 fiscal year, an adverse commission adjustment ($1.5 million) arising from greater than expected sales declines and higher pension, employee insurance and workers’ compensation costs due to changes in discount rates, unfavorable claim activity and loss experience adjustments, respectively. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Depreciation and amortization expense was $18.0 million in 2010 compared to $22.7 million in 2009 and $29.4 million in 2008. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------|

| ·   | Other charges and impairments reflect costs incurred from strategic actions implemented by the Company to restructure its operations, costs that are unpredictable and atypical of the Company’s operations and additional charges due to asset impairments.  Actions taken during 2010, 2009 and 2008 are as follows: |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| in thousands                                                               |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|----------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                       |   |   |   |   |   |   |   |   |   |
| Impairment charges (a)                                                     |   | $      | 1,871  |   |   | $      | 300    |   |   | $ | 739 |   |
| Kiddie Kandids integration costs (b)                                       |   |   | 1,335  |   |   |   | -      |   |   |   | - |   |
| Severance and related costs (c)                                            |   |   | 538    |   |   |   | 970    |   |   |   | 2,046 |   |
| Bella Pictures® Acquisition costs (d)                                 |   |   | 472    |   |   |   | -      |   |   |   | - |   |
| Other transition related costs - PCA Acquisition (e)                       |   |   | 388    |   |   |   | 527    |   |   |   | 1,255 |   |
| Gain on sale of Brampton facility (f)                                      |   |   | (1,473 | )      |   |   | -      |   |   |   | - |   |
| Sears fees related to the settlement of the previous license agreement (g) |   |   | -      |   |   |   | -      |   |   |   | 7,527 |   |
| Proxy contest fees (h)                                                     |   |   | -      |   |   |   | 871    |   |   |   | - |   |
| Other (i)                                                                  |   |   | 1,961  |   |   |   | 626    |   |   |   | 1,990 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Other Charges and Impairments                                        |   | $      | 5,092  |   |   | $      | 3,294  |   |   | $ | 13,557 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |

| (a)   | During 2010, 2009 and 2008, the Company incurred $1.9 million, $300,000 and $739,000, respectively, related to the write-down of its Matthews, North Carolina, facility asset value.  |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Charges relate to certain integration costs incurred in 2010 in connection with the Kiddie Kandids, LLC asset acquisition. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------|

| (c)   | Charges in 2010 primarily related to executive severance costs and severance costs resulting from the termination of employees in connection with the restructuring of operational support. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d)   | Charges relate to certain costs incurred in 2010 in connection with the Bella Pictures® Acquisition, primarily related to legal and consulting fees. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e)   | During 2010, expense primarily related to lab closure-related costs. |
|-----------------|----------------------------------------------------------------------|

| (f)   | Represents the gain on sale of the Brampton, Ontario facility in 2010. |
|-----------------|------------------------------------------------------------------------|

| (g)   | In 2008, the Company incurred certain fees and charges in relation to the settlement of the previous Sears license agreement. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------|

| (h)   | Charges relate to certain fees incurred in connection with the proxy contest in 2009. |
|-----------------|---------------------------------------------------------------------------------------|

| (i)   | Costs in 2010 primarily related to legal expense of $1.5 million incurred in connection with the Chrissy Larkin vs. CPI Corp. case and the $1.1 million write-off of debt fees related to the Company’s former credit facility as a result of its new revolving credit facility.  These costs were offset in part by an early termination fee of $504,000 received from Walmart in relation to certain early PMPS studio closures. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| in thousands                            |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|-----------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
|                                    |   |   |    |   |   |   |    |   |   |
| Net cash (used in) provided by:         |   |   |    |   |   |   |    |   |   |
| Operating activities (1)                |   | $      | 39,067  |   |   | $      | 31,289  |   |   | $ | 11,847 |   |
| Financing activities                    |   |   | (43,735 | )      |   |   | (33,494 | )      |   |   | (13,419 | ) |
| Investing activities                    |   |   | (8,821  | )      |   |   | (2,876  | )      |   |   | (33,488 | ) |
| Effect of exchange rate changes on cash |   |   | (61     | )      |   |   | 329     |   |   |   | (452 | ) |
| Net decrease in cash                    |   | $      | (13,550 | )      |   | $      | (4,752  | )      |   | $ | (35,512 | ) |
|                                    |   |   |    |   |   |   |    |   |   |   |   |   |

| (1)   | Includes cash flows used in discontinued operations of $816,000 in 2008. |
|-----------------|--------------------------------------------------------------------------|

|                           |   |                   |   |
|--------------------------------|--------|------------------------|--------|
| in thousands                   |   | PAYMENTS DUE BY PERIOD |   |
|                           |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 2016 and |   |
|                           |   | Total                  |   |   | 2011 |   |   | 2012 |   |   | 2013 |   |   | 2014 |   |   | 2015 |   |   | Beyond |   |
| Contractual obligations:       |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                           |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term debt (1)             |   | $                      | 48,900 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | 48,900 |   |   | $ | - |   |   | $ | - |   |
| Interest expense (2)           |   |                   | 6,742  |   |   |   | 1,741 |   |   |   | 1,932 |   |   |   | 1,949 |   |   |   | 1,120 |   |   |   | - |   |   |   | - |   |
| Operating leases               |   |                   | 8,420  |   |   |   | 1,803 |   |   |   | 1,704 |   |   |   | 1,565 |   |   |   | 1,419 |   |   |   | 1,425 |   |   |   | 504 |   |
| Purchase obligations for       |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| materials and services (3)     |   |                   | 4,307  |   |   |   | 3,729 |   |   |   | 538 |   |   |   | 40 |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Pension plan contributions (4) |   |                   | 2,849  |   |   |   | 2,849 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Sears Agreement fees (5)       |   |                   | 500    |   |   |   | 150 |   |   |   | 150 |   |   |   | 150 |   |   |   | 150 |   |   |   | - |   |   |   | - |   |
| Other liabilities (6)          |   |                   | 1,019  |   |   |   | 1,000 |   |   |   | 8 |   |   |   | 7 |   |   |   | 4 |   |   |   | - |   |   |   | - |   |
|                           |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| TOTAL                          |   | $                      | 72,737 |   |   | $ | 11,272 |   |   | $ | 4,332 |   |   | $ | 3,711 |   |   | $ | 51,593 |   |   | $ | 1,425 |   |   | $ | 504 |   |
|                           |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands                  |   | AMOUNT OF COMMITMENT EXPIRATION PER PERIOD |   |
|-------------------------------|--------|--------------------------------------------|--------|
|                          |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 2016 and |   |
|                          |   | Total                                      |   |   | 2011 |   |   | 2012 |   |   | 2013 |   |   | 2014 |   |   | 2015 |   |   | Beyond |   |
| Other commitments:            |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                          |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Standby letters of credit (7) |   | $                                          | 14,801 |   |   | $ | 14,801 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
| Interest expense (8)          |   |                                       | 404    |   |   |   | 404 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                          |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| TOTAL                         |   | $                                          | 15,205 |   |   | $ | 15,205 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|                          |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1)    |   | Amount represents the total principal due on the Company’s revolving credit facility as of February 5, 2011.  The facility expires in August 2014.  See Note 10 to the Notes to Consolidated Financial Statements.  This balance could increase or decrease substantially through the expiration date based on the Company’s future repayments and borrowings due to operations and strategic initiatives. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (2)    |   | Amounts represent the expected cash payments of the Company’s interest expense on its revolving credit facility, as of February 5, 2011, calculated based on the rates included in the Credit Agreement, effective August 30, 2010.  These amounts could increase or decrease depending on the Company’s future revolving credit facility levels.                                                                              |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (3)    |   | Amount represents outstanding purchase commitments at February 5, 2011.  The purchase commitments relate principally to marketing initiatives, database maintenance contracts, photographic paper, manufacturing supplies and telecommunication services.                                                                                                                                                                             |
| (4)    |   | The Company anticipates it will make a contribution of approximately $2.8 million to the pension plan in 2011.  Obligations beyond 2011 are not currently estimable.  Future contributions to the pension plan will be dependent upon legislation, future changes in discount rates and the earnings performance of the plan assets.                                                                                        |
| (5)    |   | The Company is obligated to remit to Sears additional payments as stipulated in the settlement of the previous license agreement and the current license agreement.  A $150,000 payment is due to Sears on December 31 of each year through 2014 as part of the settlement of the previous license agreement.                                                                                                                              |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (6)    |   | Amounts consist primarily of severance and related costs, which are recorded at the contractual amounts due.                                                                                                                                                                                                                                                                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (7)    |   | The Company primarily uses standby letters of credit to collateralize its various large deductible insurance programs.  The letters of credit generally have a one-year maturity and have auto renewal clauses.                                                                                                                                                                                                                            |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (8)    |   | Amount represents the expected cash payments of the Company’s interest expense on its standby letters of credit.                                                                                                                                                                                                                                                                                                                          |

Item

Item

| (a)    | FINANCIAL STATEMENTS |                                                                               | PAGES                                                                              |
|--------|----------------------|------------------------------------------------------------------------------------|------------------------------------------------------------------------------------|
|   |                 |                                                                               |
|   | -                    |                                                                               | Report of Independent Registered Public Accounting Firm                            |   | 31 |
|   | -                    |                                                                               | Consolidated Balance Sheets as of February 5, 2011 and February 6, 2010            |   | 32 |
|   | -                    |                                                                               | Consolidated Statements of Operations for the fiscal years ended                   |   |   |
|   |                 | February 5, 2011, February 6, 2010 and February 7, 2009                            |                                                                               | 34 |
|   | -                    |                                                                               | Consolidated Statements of Changes in Stockholders' Equity                         |   |   |
|   |                 | for the fiscal years ended February 5, 2011, February 6, 2010 and February 7, 2009 |                                                                               | 35 |
|   | -                    |                                                                               | Consolidated Statements of Cash Flows for the fiscal years ended February 5, 2011, |   |   |
|   |                 | February 6, 2010 and February 7, 2009                                              |                                                                               | 36 |
|   | -                    |                                                                               | Notes to Consolidated Financial Statements                                         |   | 39 |

Report

Consolidated

| in thousands                                    |   | February 5, 2011 |    |   | February 6, 2010 |   |
|-------------------------------------------------|--------|------------------|---------|--------|------------------|--------|
|                                            |   |             |    |   |             |   |
| ASSETS                                          |   |             |    |   |             |   |
| Current assets:                                 |   |             |    |   |             |   |
| Cash and cash equivalents                       |   | $                | 5,363   |   |             | $      | 18,913 |   |
| Accounts receivable:                            |   |             |    |   |             |   |   |   |
| Trade                                           |   |             | 4,707   |   |             |   | 5,960 |   |
| Other                                           |   |             | 971     |   |             |   | 880 |   |
| Inventories                                     |   |             | 7,460   |   |             |   | 7,465 |   |
| Prepaid expenses and other current assets       |   |             | 4,971   |   |             |   | 5,396 |   |
| Refundable income taxes                         |   |             | -       |   |             |   | 1,350 |   |
| Deferred tax assets                             |   |             | 5,976   |   |             |   | 7,253 |   |
| Assets held for sale                            |   |             | 641     |   |             |   | 6,338 |   |
|                                            |   |             |    |   |             |   |   |   |
| Total current assets                            |   |             | 30,089  |   |             |   | 53,555 |   |
|                                            |   |             |    |   |             |   |   |   |
| Property and equipment:                         |   |             |    |   |             |   |   |   |
| Land                                            |   |             | 2,185   |   |             |   | 2,185 |   |
| Buildings and building improvements             |   |             | 25,343  |   |             |   | 25,289 |   |
| Leasehold improvements                          |   |             | 4,383   |   |             |   | 4,491 |   |
| Photographic, sales and manufacturing equipment |   |             | 176,974 |   |             |   | 168,371 |   |
| Property not in use (see Note 7)                |   |             | 3,401   |   |             |   | - |   |
| Total                                           |   |             | 212,286 |   |             |   | 200,336 |   |
| Less accumulated depreciation and amortization  |   |             | 176,288 |   |             |   | 166,167 |   |
|  Property and equipment, net               |   |             | 35,998  |   |             |   | 34,169 |   |
|                                            |   |             |    |   |             |   |   |   |
| Prepaid debt fees                               |   |             | 1,838   |   |             |   | 2,237 |   |
| Goodwill                                        |   |             | 22,874  |   |             |   | 21,720 |   |
| Intangible assets, net                          |   |             | 37,862  |   |             |   | 38,660 |   |
| Deferred tax assets                             |   |             | 7,166   |   |             |   | 7,701 |   |
| Other assets                                    |   |             | 7,973   |   |             |   | 8,549 |   |
|                                            |   |             |    |   |             |   |   |   |
| TOTAL ASSETS                                    |   | $                | 143,800 |   |             | $      | 166,591 |   |
|                                            |   |             |    |   |             |   |   |   |

| in thousands, except share and per share data                                                                   |   | February 5, 2011 |    |    | February 6, 2010 |   |
|-----------------------------------------------------------------------------------------------------------------|--------|------------------|---------|---------|------------------|--------|
|                                                                                                            |   |             |    |    |             |   |
| LIABILITIES                                                                                                     |   |             |    |    |             |   |
| Current liabilities:                                                                                            |   |             |    |    |             |   |
| Current maturities of long-term debt                                                                            |   | $                | -       |    |             | $      | 19,686 |   |
| Accounts payable                                                                                                |   |             | 7,583   |    |             |   | 4,390 |   |
| Accrued employment costs                                                                                        |   |             | 8,905   |    |             |   | 9,878 |   |
| Customer deposit liability                                                                                      |   |             | 16,403  |    |             |   | 11,528 |   |
| Income taxes payable                                                                                            |   |             | 215     |    |             |   | - |   |
| Sales taxes payable                                                                                             |   |             | 3,767   |    |             |   | 3,929 |   |
| Accrued advertising expenses                                                                                    |   |             | 995     |    |             |   | 1,062 |   |
| Accrued expenses and other liabilities                                                                          |   |             | 11,335  |    |             |   | 11,959 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| Total current liabilities                                                                                       |   |             | 49,203  |    |             |   | 62,432 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| Long-term debt, less current maturities                                                                         |   |             | 48,900  |    |             |   | 57,855 |   |
| Accrued pension plan obligations                                                                                |   |             | 14,862  |    |             |   | 17,724 |   |
| Other liabilities                                                                                               |   |             | 16,565  |    |             |   | 18,392 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| Total liabilities                                                                                               |   |             | 129,530 |    |             |   | 156,403 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| CONTINGENCIES (see Note 16)                                                                                     |   |             |    |    |             |   |   |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| STOCKHOLDERS' EQUITY                                                                                            |   |             |    |    |             |   |   |   |
| Preferred stock, no par value, 1,000,000 shares authorized; no shares outstanding                               |   |             | -       |    |             |   | - |   |
| Preferred stock, Series A, no par value, 200,000 shares authorized; no shares outstanding                       |   |             | -       |    |             |   | - |   |
| Common stock, $.40 par value, 50,000,000 shares authorized; 9,129,013 and 9,184,081 shares outstanding at       |   |             |    |    |             |   |   |   |
| February 5, 2011, and February 6, 2010, respectively                                                            |   |             | 3,652   |    |             |   | 3,674 |   |
| Additional paid-in capital                                                                                      |   |             | 30,785  |    |             |   | 29,017 |   |
| Retained earnings                                                                                               |   |             | 40,794  |    |             |   | 41,516 |   |
| Accumulated other comprehensive loss                                                                            |   |             | (12,927 | )       |             |   | (14,887 | ) |
|                                                                                                            |   |             | 62,304  |    |             |   | 59,320 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| Treasury stock - at cost, 2,133,566 and 2,175,591 shares at February 5, 2011 and February 6, 2010, respectively |   |             | (48,050 | )  |             |   | (49,132 | )  |
|                                                                                                            |   |             |    |    |             |   |   |   |
| Total CPI Corp. stockholders' equity                                                                            |   |             | 14,254  |    |             |   | 10,188 |   |
| Noncontrolling interest in subsidiary (see Note 4)                                                              |   |             | 16      |    |             |   | - |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| Total stockholders' equity                                                                                      |   |             | 14,270  |    |             |   | 10,188 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                                      |   | $                | 143,800 |    |             | $      | 166,591 |   |
|                                                                                                            |   |             |    |    |             |   |   |   |

Consolidated

| in thousands, except share and per share data                          |   | 2010   |      |   | 2009   |   |      | 2008   |   |
|------------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|
|                                                                   |   |   |      |   |   |   |      |   |   |
| Net sales                                                              |   | $      | 407,035   |   |   | $      | 422,371   |   |   | $ | 462,548 |   |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Cost and expenses:                                                     |   |   |      |   |   |   |      |   |   |   |   |   |
| Cost of sales (exclusive of depreciation and amortization shown below) |   |   | 28,263    |   |   |   | 30,626    |   |   |   | 43,280 |   |
| Selling, general and administrative expenses                           |   |   | 337,490   |   |   |   | 339,138   |   |   |   | 377,310 |   |
| Depreciation and amortization                                          |   |   | 17,962    |   |   |   | 22,740    |   |   |   | 29,432 |   |
| Other charges and impairments                                          |   |   | 5,092     |   |   |   | 3,294     |   |   |   | 13,557 |   |
|                                                                   |   |   | 388,807   |   |   |   | 395,798   |   |   |   | 463,579 |   |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Income (loss) from operations                                          |   |   | 18,228    |   |   |   | 26,573    |   |   |   | (1,031 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Interest expense                                                       |   |   | 3,860     |   |   |   | 7,030     |   |   |   | 8,529 |   |
| Interest income                                                        |   |   | 17        |   |   |   | 94        |   |   |   | 2 |   |
| Other income (expense), net                                            |   |   | 929       |   |   |   | (44       | )      |   |   | 190 |   |
| Income (loss) from operations before income tax expense (benefit)      |   |   | 15,314    |   |   |   | 19,593    |   |   |   | (9,368 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Income tax expense (benefit)                                           |   |   | 3,413     |   |   |   | 5,796     |   |   |   | (2,644 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Net income (loss) from continuing operations                           |   |   | 11,901    |   |   |   | 13,797    |   |   |   | (6,724 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Net loss from discontinued operations, net of income tax benefit       |   |   | -         |   |   |   | -         |   |   |   | (961 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Net income (loss)                                                      |   |   | 11,901    |   |   |   | 13,797    |   |   |   | (7,685 | ) |
| Net loss attributable to noncontrolling interest                       |   |   | (7        | )      |   |   | -         |   |   |   | - |   |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| NET INCOME (LOSS) ATTRIBUTABLE TO CPI CORP.                            |   | $      | 11,908    |   |   | $      | 13,797    |   |   | $ | (7,685 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| NET INCOME (LOSS) PER COMMON SHARE                                     |   |   |      |   |   |   |      |   |   |   |   |   |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Net income (loss) per share from continuing operations - diluted       |   | $      | 1.64      |   |   | $      | 1.97      |   |   | $ | (1.03 | ) |
| Net loss per share from discontinued operations - diluted              |   |   | -         |   |   |   | -         |   |   |   | (0.15 | ) |
| Net income (loss) per share attibutable to CPI Corp. - diluted         |   | $      | 1.64      |   |   | $      | 1.97      |   |   | $ | (1.18 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Net income (loss) per share from continuing operations - basic         |   | $      | 1.64      |   |   | $      | 1.97      |   |   | $ | (1.03 | ) |
| Net loss per share from discontinued operations - basic                |   |   | -         |   |   |   | -         |   |   |   | (0.15 | ) |
| Net income (loss) per share attributable to CPI Corp. - basic          |   | $      | 1.64      |   |   | $      | 1.97      |   |   | $ | (1.18 | ) |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Dividends per share                                                    |   | $      | 0.91      |   |   | $      | 0.64      |   |   | $ | 0.64 |   |
|                                                                   |   |   |      |   |   |   |      |   |   |   |   |   |
| Weighted average number of common and common equivalent                |   |   |      |   |   |   |      |   |   |   |   |   |
| shares outstanding-diluted                                             |   |   | 7,271,672 |   |   |   | 7,019,981 |   |   |   | 6,509,840 |   |
| Weighted average number of common and common equivalent                |   |   |      |   |   |   |      |   |   |   |   |   |
| shares outstanding-basic                                               |   |   | 7,256,619 |   |   |   | 6,992,511 |   |   |   | 6,509,840 |   |

Consolidated

| in thousands, except share and per share data                          |   |   |   |   |       |   |    |     |   |   | Accumulated   |   |   |     |    |   |        |   |     |   |   |
|------------------------------------------------------------------------|--------|--------|--------|--------|------------|--------|---------|----------|--------|--------|---------------|--------|--------|----------|---------|--------|-------------|--------|----------|--------|--------|
|                                                                   |   |   |   |   | Additional |   |    |     |   |   | other         |   |   | Treasury |    |   |  Non-  |   |     |   |   |
|                                                                   |   | Common |   |   | paid-in    |   |    | Retained |   |   | comprehensive |   |   | stock,   |    |   | controlling |   |     |   |   |
|                                                                   |   | stock  |   |   | capital    |   |    | earnings |   |   | (loss) income |   |   | at cost  |    |   | Interest    |   |     | Total  |   |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |
| Balance at February 2, 2008                                            |   | $      | 6,811  |   |       | $      | 54,783  |     |   | $      | 195,524       |   |   | $        | (6,725  | )      |        | $      | (233,419 | )      |   | $ | - |   |   | $ | 16,974 |   |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Net loss                                                               |   |   | -      |   |       |   | -       |     |   |   | (7,685        | )      |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (7,685 | ) |
| Total other comprehensive loss, net of tax effect                      |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| (consisting primarily of foreign exchange impact)                      |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | (6,389  | )      |        |   | -        |   |   |   | - |   |   |   | (6,389 | ) |
| Total comprehensive loss                                               |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (14,074 | ) |
| Surrender of employee shares for taxes                                 |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   | (175     | )      |   |   | - |   |   |   | (175 | ) |
| Issuance of common stock and restricted stock awards,                  |   |   | 25     |   |       |   | (229    | )        |   |   | -             |   |   |     | -       |   |        |   | 1,590    |   |   |   | - |   |   |   | 1,386 |   |
| net of forfeitures (419,478 shares)                                    |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Stock-based compensation recognized                                    |   |   | -      |   |       |   | 1,037   |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | 1,037 |   |
| Decreased tax benefit related to stock-based compensation              |   |   | -      |   |       |   | (178    | )        |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (178 | ) |
| Dividends ($0.64 per common share)                                     |   |   | -      |   |       |   | -       |     |   |   | (4,135        | )      |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (4,135 | ) |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Balance at February 7, 2009                                            |   | $      | 6,836  |   |       | $      | 55,413  |     |   | $      | 183,704       |   |   | $        | (13,114 | )      |        | $      | (232,004 | )      |   | $ | - |   |   | $ | 835 |   |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Net income                                                             |   |   | -      |   |       |   | -       |     |   |   | 13,797        |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | 13,797 |   |
| Total other comprehensive loss, net of tax effect                      |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| (consisting primarily of defined benefit plan impact)                  |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | (1,773  | )      |        |   | -        |   |   |   | - |   |   |   | (1,773 | ) |
| Total comprehensive income                                             |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   |     |   |   |   | - |   |   |   | 12,024 |   |
| Surrender of employee shares for taxes                                 |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   | (30      | )      |   |   | - |   |   |   | (30 | ) |
| Retirement of treasury stock (8,000,000 shares, at average cost)       |   |   | (3,200 | )      |       |   | (25,940 | )        |   |   | (151,526      | )      |   |     | -       |   |        |   | 180,666  |   |   |   | - |   |   |   | - |   |
| Issuance of common stock and restricted stock awards,                  |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| net of forfeitures (193,292 shares)                                    |   |   | 38     |   |       |   | (1,673  | )        |   |   | -             |   |   |     | -       |   |        |   | 2,236    |   |   |   | - |   |   |   | 601 |   |
| Stock-based compensation recognized                                    |   |   | -      |   |       |   | 1,092   |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | 1,092 |   |
| Excess tax benefit related to stock-based compensation                 |   |   | -      |   |       |   | 125     |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | 125 |   |
| Dividends ($0.64 per common share)                                     |   |   | -      |   |       |   | -       |     |   |   | (4,459        | )      |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (4,459 | ) |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Balance at February 6, 2010                                            |   | $      | 3,674  |   |       | $      | 29,017  |     |   | $      | 41,516        |   |   | $        | (14,887 | )      |        | $      | (49,132  | )      |   | $ | - |   |   | $ | 10,188 |   |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                                      |   |   | -      |   |       |   | -       |     |   |   | 11,908        |   |   |     | -       |   |        |   | -        |   |   |   | (7 | ) |   |   | 11,901 |   |
| Total other comprehensive income, net of tax effect                    |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| (consisting primarily of defined benefit plan impact)                  |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | 1,960   |   |        |   | -        |   |   |   | - |   |   |   | 1,960 |   |
| Total comprehensive income                                             |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   |     |   |   |   | - |   |   |   | 13,861 |   |
| Issuance of noncontrolling interest                                    |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | 23 |   |   |   | 23 |   |
| Surrender of employee shares for taxes                                 |   |   | -      |   |       |   | -       |     |   |   | -             |   |   |     | -       |   |        |   | (183     | )      |   |   | - |   |   |   | (183 | ) |
| Purchase and constructive retirement of stock (324,716 shares at cost) |   |   | (130   | )      |       |   | (1,059  | )        |   |   | (6,017        | )      |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (7,206 | ) |
| Issuance of common stock and restricted stock awards,                  |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| net of forfeitures (320,959 shares)                                    |   |   | 108    |   |       |   | (507    | )        |   |   | -             |   |   |     | -       |   |        |   | 1,265    |   |   |   | - |   |   |   | 866 |   |
| Stock options exercised                                                |   |   | -      |   |       |   | (82     | )        |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (82 | ) |
| Stock-based compensation recognized                                    |   |   | -      |   |       |   | 3,016   |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | 3,016 |   |
| Excess tax benefit related to stock-based compensation                 |   |   | -      |   |       |   | 400     |     |   |   | -             |   |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | 400 |   |
| Dividends ($0.91 per common share)                                     |   |   | -      |   |       |   | -       |     |   |   | (6,613        | )      |   |     | -       |   |        |   | -        |   |   |   | - |   |   |   | (6,613 | ) |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |
| Balance at February 5, 2011                                            |   | $      | 3,652  |   |       | $      | 30,785  |     |   | $      | 40,794        |   |   | $        | (12,927 | )      |        | $      | (48,050  | )      |   | $ | 16 |   |   | $ | 14,270 |   |
|                                                                   |   |   |   |   |       |   |    |     |   |   |          |   |   |     |    |   |        |   |     |   |   |   |   |   |   |   |   |   |

Consolidated

| in thousands                                                                                  |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|-----------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Reconciliation of net income (loss) to cash flows provided by (used in) operating activities: |   |   |   |   |   |   |   |   |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                                                             |   | $      | 11,901 |   |   | $      | 13,797 |   |   | $ | (7,685 | ) |
|                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Adjustments for items not requiring (providing) cash:                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                                 |   |   | 17,962 |   |   |   | 22,740 |   |   |   | 29,432 |   |
| Loss from discontinued operations                                                             |   |   | -      |   |   |   | -      |   |   |   | 961 |   |
| Amortization of prepaid debt fees                                                             |   |   | 890    |   |   |   | 968    |   |   |   | 678 |   |
| Loss from extinguishment of debt                                                              |   |   | 1,052  |   |   |   | -      |   |   |   | - |   |
| Stock-based compensation expense                                                              |   |   | 3,016  |   |   |   | 1,092  |   |   |   | 1,037 |   |
| Issuance of common stock to Sears                                                             |   |   | -      |   |   |   | -      |   |   |   | 865 |   |
| (Gain) loss on sale of assets held for sale, net                                              |   |   | (1,655 | )      |   |   | (619   | )      |   |   | - |   |
| Loss on impairment of property and equipment                                                  |   |   | 1,879  |   |   |   | 300    |   |   |   | 739 |   |
| Loss on disposition of property and equipment                                                 |   |   | 134    |   |   |   | 580    |   |   |   | 1,387 |   |
| Deferred income tax provision                                                                 |   |   | 748    |   |   |   | 6,195  |   |   |   | (2,550 | ) |
| Change in interest rate swap                                                                  |   |   | (2,033 | )      |   |   | (1,514 | )      |   |   | 617 |   |
| Pension, supplemental retirement plan and profit sharing expense                              |   |   | 2,042  |   |   |   | 870    |   |   |   | 505 |   |
| Other                                                                                         |   |   | (378   | )      |   |   | 38     |   |   |   | - |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Increase (decrease) in cash flow from operating assets and liabilities:                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts receivable                                                                           |   |   | 1,301  |   |   |   | 213    |   |   |   | 4,523 |   |
| Inventories                                                                                   |   |   | 388    |   |   |   | 1,201  |   |   |   | 5,448 |   |
| Prepaid expenses and other current assets                                                     |   |   | 514    |   |   |   | 310    |   |   |   | (1,238 | ) |
| Accounts payable                                                                              |   |   | 3,159  |   |   |   | (2,439 | )      |   |   | (5,153 | ) |
| Contribution to pension plan                                                                  |   |   | (1,620 | )      |   |   | (1,560 | )      |   |   | (3,157 | ) |
| Supplemental retirement plan payments                                                         |   |   | (78    | )      |   |   | (141   | )      |   |   | (1,283 | ) |
| Accrued expenses and other liabilities                                                        |   |   | (999   | )      |   |   | (8,584 | )      |   |   | (4,227 | ) |
| Income taxes payable                                                                          |   |   | 1,522  |   |   |   | (992   | )      |   |   | (708 | ) |
| Deferred revenues and related costs                                                           |   |   | (441   | )      |   |   | (1,076 | )      |   |   | (7,720 | ) |
| Other                                                                                         |   |   | (237   | )      |   |   | (90    | )      |   |   | 192 |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows provided by continuing operations                                                  |   |   | 39,067 |   |   |   | 31,289 |   |   |   | 12,663 |   |
| Cash flows used in discontinued operations                                                    |   |   | -      |   |   |   | -      |   |   |   | (816 | ) |
| Cash flows provided by operating activities                                                   |   | $      | 39,067 |   |   | $      | 31,289 |   |   | $ | 11,847 |   |
|                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands                                                             |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|--------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
|                                                                     |   |   |    |   |   |   |    |   |   |
| Cash flows provided by operating activities                              |   |   | 39,067  |   |   |   | 31,289  |   |   |   | 11,847 |   |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Cash flows (used in) provided by financing activities:                   |   |   |    |   |   |   |    |   |   |   |   |   |
| Repayment of long-term debt                                              |   |   | (77,541 | )      |   |   | (28,187 | )      |   |   | (8,697 | ) |
| Borrowings under revolving credit facility                               |   |   | 136,936 |   |   |   | -       |   |   |   | - |   |
| Repayments on revolving credit facility                                  |   |   | (88,036 | )      |   |   | -       |   |   |   | - |   |
| Payment of debt issuance costs                                           |   |   | (1,543  | )      |   |   | (943    | )      |   |   | - |   |
| Cash dividends                                                           |   |   | (6,613  | )      |   |   | (4,459  | )      |   |   | (4,135 | ) |
| Purchase of treasury stock                                               |   |   | (7,206  | )      |   |   | -       |   |   |   | - |   |
| Proceeds from stock options exercised                                    |   |   | 130     |   |   |   | -       |   |   |   | - |   |
| Surrender of employee shares for taxes                                   |   |   | (262    | )      |   |   | (30     | )      |   |   | (175 | ) |
| Tax benefit (deficiency) excess from stock-based compensation            |   |   | 400     |   |   |   | 125     |   |   |   | (178 | ) |
| Other                                                                    |   |   | -       |   |   |   | -       |   |   |   | (234 | ) |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Cash flows used in financing activities                                  |   |   | (43,735 | )      |   |   | (33,494 | )      |   |   | (13,419 | ) |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Cash flows (used in) provided by investing activities:                   |   |   |    |   |   |   |    |   |   |   |   |   |
| Additions to property and equipment                                      |   |   | (13,490 | )      |   |   | (5,234  | )      |   |   | (36,074 | ) |
| Proceeds from sale of assets held for sale                               |   |   | 3,120   |   |   |   | 1,902   |   |   |   | - |   |
| Proceeds from sale of property and equipment                             |   |   | 27      |   |   |   | 343     |   |   |   | 106 |   |
| Net cash received in connection with the Bella Pictures Acquisition      |   |   | 1,439   |   |   |   | -       |   |   |   | - |   |
| Proceeds from Rabbi Trust used for supplemental retirement plan payments |   |   | 88      |   |   |   | 153     |   |   |   | 1,295 |   |
| Distribution of Rabbi Trust funds in excess of related obligations       |   |   | -       |   |   |   | -       |   |   |   | 1,311 |   |
| Other                                                                    |   |   | (5      | )      |   |   | (40     | )      |   |   | (126 | ) |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Cash flows used in investing activities                                  |   |   | (8,821  | )      |   |   | (2,876  | )      |   |   | (33,488 | ) |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Effect of exchange rate changes on cash and cash equivalents             |   |   | (61     | )      |   |   | 329     |   |   |   | (452 | ) |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Net (decrease) increase in cash and cash equivalents                     |   |   | (13,550 | )      |   |   | (4,752  | )      |   |   | (35,512 | ) |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Cash and cash equivalents at beginning of year                           |   |   | 18,913  |   |   |   | 23,665  |   |   |   | 59,177 |   |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |
| Cash and cash equivalents at end of year                                 |   | $      | 5,363   |   |   | $      | 18,913  |   |   | $ | 23,665 |   |
|                                                                     |   |   |    |   |   |   |    |   |   |   |   |   |

| in thousands                                                                                |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|---------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                                        |   |   |   |   |   |   |   |   |   |
| Supplemental cash flow information:                                                         |   |   |   |   |   |   |   |   |   |
| Interest paid                                                                               |   | $      | 5,340  |   |   | $      | 7,481  |   |   | $ | 7,969 |   |
| Income taxes paid, net                                                                      |   | $      | 750    |   |   | $      | 469    |   |   | $ | 228 |   |
| Supplemental non-cash financing activities:                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance of treasury stock under the Employee Profit Sharing Plan                           |   | $      | 733    |   |   | $      | 594    |   |   | $ | 521 |   |
| Issuance of restricted stock and stock options to employees and directors                   |   | $      | 3,439  |   |   | $      | 850    |   |   | $ | 876 |   |
| Issuance of noncontrolling interest in connection with the Bella Pictures® Acquisition |   | $      | 23     |   |   | $      | -      |   |   | $ | - |   |
| Issuance of common stock to Sears                                                           |   | $      | -      |   |   | $      | -      |   |   | $ | 865 |   |
|                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |

Notes

| Fiscal year |   | Ended            |   | Weeks |
|-------------|--------|------------------|--------|-------|
| 2010        |   | February 5, 2011 |   | 52    |
| 2009        |   | February 6, 2010 |   | 52    |
| 2008        |   | February 7, 2009 |   | 53    |

| Buildings and building improvements             |   | 15 to 19 years |
|-------------------------------------------------|--------|----------------|
| Leasehold improvements                          |   | 5 to 15 years  |
| Photographic, sales and manufacturing equipment |   | 2 to 7 years   |

| Current assets                 |   | $      | 457    |   |
|--------------------------------|--------|--------|--------|--------|
| Property and equipment         |   |   | 1,729  |   |
| Goodwill                       |   |   | 983    |   |
| Tradename                      |   |   | 755    |   |
|                           |   |   |   |   |
| Total assets acquired          |   | $      | 3,924  |   |
|                           |   |   |   |   |
| Current liabilities assumed    |   |   | (5,340 | )      |
| Net cash received from Seller  |   |   | 1,439  |   |
|                           |   |   |   |   |
| Total allocated purchase price |   | $      | 23     |   |
|                           |   |   |   |   |

|                                                      |   | 2010   |    |   | 2009   |   |
|-----------------------------------------------------------|--------|--------|---------|--------|--------|--------|
|                                                      |   |   |    |   |   |   |
| Revenue                                                   |   | $      | 413,517 |   |   | $      | 430,004 |   |
|                                                      |   |   |    |   |   |   |   |   |
| Net income                                                |   |   | 5,331   |   |   |   | 812 |   |
| Net loss attributable to noncontrolling interest          |   |   | (281    | )      |   |   | (649 | ) |
| Net income attributable to CPI Corp.                      |   | $      | 5,612   |   |   | $      | 1,461 |   |
|                                                      |   |   |    |   |   |   |   |   |
| Diluted income per common share attributable to CPI Corp. |   | $      | 0.77    |   |   | $      | 0.21 |   |
|                                                      |   |   |    |   |   |   |   |   |
| Basic income per common share attributable to CPI Corp.   |   | $      | 0.77    |   |   | $      | 0.21 |   |

| in thousands                          |   | 2008   |   |
|---------------------------------------|--------|--------|--------|
|                                  |   |   |   |
| Discontinued operations:              |   |   |   |
|                                  |   |   |   |
| Net Sales                             |   | $      | 463    |   |
|                                  |   |   |   |   |
| Operating loss                        |   | $      | 1,504  |   |
| Tax benefit                           |   |   | 543    |   |
|                                  |   |   |   |   |
| Net loss from discontinued operations |   | $      | 961    |   |
|                                  |   |   |   |   |

| in thousands                              |   | February 5, 2011 |   |   | February 6, 2010 |   |
|-------------------------------------------|--------|------------------|--------|--------|------------------|--------|
|                                      |   |             |   |   |             |   |
| Raw materials - film, paper and chemicals |   | $                | 2,130  |   |             | $      | 2,181 |   |
| Portraits in process                      |   |             | 1,274  |   |             |   | 1,138 |   |
| Finished portraits pending delivery       |   |             | 97     |   |             |   | 91 |   |
| Frames and accessories                    |   |             | 230    |   |             |   | 258 |   |
| Studio supplies                           |   |             | 2,556  |   |             |   | 2,840 |   |
| Equipment repair parts and supplies       |   |             | 627    |   |             |   | 650 |   |
| Other                                     |   |             | 546    |   |             |   | 307 |   |
|                                      |   |             |   |   |             |   |   |   |
| Total                                     |   | $                | 7,460  |   |             | $      | 7,465 |   |
|                                      |   |             |   |   |             |   |   |   |

| in thousands                        |   | February 5, 2011 |   |   | February 6, 2010 |   |
|-------------------------------------|--------|------------------|--------|--------|------------------|--------|
|                                |   |             |   |   |             |   |
| Land                                |   | $                | -      |   |             | $      | 2,203 |   |
| Buildings and building improvements |   |             | 641    |   |             |   | 4,135 |   |
|                                |   |             |   |   |             |   |   |   |
| Assets held for sale                |   | $                | 641    |   |             | $      | 6,338 |   |
|                                |   |             |   |   |             |   |   |   |

| in thousands                           |   | February 5, 2011 |   |
|----------------------------------------|--------|------------------|--------|
|                                   |   |             |   |
| Land                                   |   | $                | 996    |   |
| Buildings and building improvements(1) |   |             | 2,405  |   |
|                                   |   |             |   |   |
| Property not in use                    |   | $                | 3,401  |   |
|                                   |   |             |   |   |

| (1)   | Depreciation expense of $49,000 related to the building and building improvements in fiscal year 2010 is included in the total accumulated depreciation and amortization line in the Consolidated Balance Sheet. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                   |   | 2010   |   |   | 2009   |   |
|----------------------------------------|--------|--------|--------|--------|--------|--------|
| Balance, beginning of year             |   | $      | 21,720 |   |   | $      | 21,459 |   |
| Bella Pictures Acquisition             |   |   | 983    |   |   |   | - |   |
| Translation impact on foreign balances |   |   | 171    |   |   |   | 261 |   |
| Balance, end of year                   |   | $      | 22,874 |   |   | $      | 21,720 |   |
|                                   |   |   |   |   |   |   |   |   |

| 2010                    |   |
|-------------------------|--------|
|                    |   | Net Balance |   |   |   |   |   |   |   |   | Translation |   |   | Net Balance |   |
|                    |   | at Beginning |   |   |   |   |   | Accumulated |   |   | Impact of |   |   | at End |   |
|                    |   | of Year |   |   | Acquisition |   |   | Amortization |   |   | Foreign Balances |   |   | of Year |   |
|                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Acquired host agreement |   | $ | 38,238 |   |   | $ | - |   |   | $ | (2,049 | ) |   | $ | 530 |   |   | $ | 36,719 |   |
| Acquired customer lists |   |   | 422 |   |   |   | 257 |   |   |   | (294 | ) |   |   | 5 |   |   |   | 390 |   |
| Acquired tradename      |   |   | - |   |   |   | 755 |   |   |   | (2 | ) |   |   | - |   |   |   | 753 |   |
|                    |   | $ | 38,660 |   |   | $ | 1,012 |   |   | $ | (2,345 | ) |   | $ | 535 |   |   | $ | 37,862 |   |
|                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| 2009                    |   |
|-------------------------|--------|
|                    |   | Net Balance |   |   |   |   |   |   |   |   | Translation |   |   | Net Balance |   |
|                    |   | at Beginning |   |   |   |   |   | Accumulated |   |   | Impact of |   |   | at End |   |
|                    |   | of Year |   |   | Acquisition |   |   | Amortization |   |   | Foreign Balances |   |   | of Year |   |
|                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Acquired host agreement |   | $ | 39,398 |   |   | $ | - |   |   | $ | (2,019 | ) |   | $ | 859 |   |   | $ | 38,238 |   |
| Acquired customer list  |   |   | 808 |   |   |   | - |   |   |   | (401 | ) |   |   | 15 |   |   |   | 422 |   |
|                    |   | $ | 40,206 |   |   | $ | - |   |   | $ | (2,420 | ) |   | $ | 874 |   |   | $ | 38,660 |   |
|                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| 2011 |   | $2,326 |
|------|--------|--------|
| 2012 |   | $2,234 |
| 2013 |   | $2,216 |
| 2014 |   | $2,190 |
| 2015 |   | $2,143 |

| in thousands                              |   | February 5, 2011 |   |   | February 6, 2010 |   |
|-------------------------------------------|--------|------------------|--------|--------|------------------|--------|
|                                      |   |             |   |   |             |   |
| Revolving credit facility                 |   | $                | 48,900 |   |             | $      | - |   |
| Term loan portion of the Credit Agreement |   |             | -      |   |             |   | 77,541 |   |
| Less: current maturities                  |   |             | -      |   |             |   | (19,686 | ) |
| Outstanding debt obligations              |   | $                | 48,900 |   |             | $      | 57,855 |   |
|                                      |   |             |   |   |             |   |   |   |

| in thousands                             |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                     |   |   |   |   |   |   |   |   |   |
| Net income (loss)                        |   | $      | 11,901 |   |   | $      | 13,797 |   |   | $ | (7,685 | ) |
| Other comprehensive income (loss):       |   |   |   |   |   |   |   |   |   |   |   |   |
| Foreign currency translation adjustments |   |   | 521    |   |   |   | 2,451  |   |   |   | (4,976 | ) |
| Defined benefit plans (1)                |   |   | 1,439  |   |   |   | (4,224 | )      |   |   | (1,413 | ) |
| Total other comprehensive income (loss)  |   |   | 1,960  |   |   |   | (1,773 | )      |   |   | (6,389 | ) |
|                                     |   |   |   |   |   |   |   |   |   |   |   |   |
| Total comprehensive income (loss)        |   | $      | 13,861 |   |   | $      | 12,024 |   |   | $ | (14,074 | ) |
|                                     |   |   |   |   |   |   |   |   |   |   |   |   |

|   | (1) |   Net of tax expense (benefit) of $892,000, ($2.6 million) and ($876,000), for 2010, 2009 and 2008, respectively. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------|

| in thousands                                       |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|----------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
|                                               |   |   |    |   |   |   |    |   |   |
| Foreign currency translation adjustments           |   | $      | (396    | )      |   | $      | (917    | )      |   | $ | (3,368 | ) |
| Unfunded projected benefit obligation, net of tax: |   |   |    |   |   |   |    |   |   |   |   |   |
| Unamortized net actuarial losses                   |   |   | (12,531 | )      |   |   | (13,970 | )      |   |   | (9,746 | ) |
| Accumulated other comprehensive loss               |   | $      | (12,927 | )      |   | $      | (14,887 | )      |   | $ | (13,114 | ) |
|                                               |   |   |    |   |   |   |    |   |   |   |   |   |

| in thousands                                                           |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                   |   |   |   |   |   |   |   |   |   |
| Impairment charges                                                     |   | $      | 1,871  |   |   | $      | 300    |   |   | $ | 739 |   |
| Kiddie Kandids integration costs                                       |   |   | 1,335  |   |   |   | -      |   |   |   | - |   |
| Severance and related costs                                            |   |   | 538    |   |   |   | 970    |   |   |   | 2,046 |   |
| Bella Pictures® Acquisition costs                                 |   |   | 472    |   |   |   | -      |   |   |   | - |   |
| Other transition related costs - PCA Acquisition                       |   |   | 388    |   |   |   | 527    |   |   |   | 1,255 |   |
| Gain on sale of Brampton facility                                      |   |   | (1,473 | )      |   |   | -      |   |   |   | - |   |
| Sears fees related to the settlement of the previous license agreement |   |   | -      |   |   |   | -      |   |   |   | 7,527 |   |
| Proxy contest fees                                                     |   |   | -      |   |   |   | 871    |   |   |   | - |   |
| Other                                                                  |   |   | 1,961  |   |   |   | 626    |   |   |   | 1,990 |   |
|                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Other Charges and Impairments                                    |   | $      | 5,092  |   |   | $      | 3,294  |   |   | $ | 13,557 |   |
|                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands                                                           |   |         |   |   |      |   |   | Asset       |   |   |     |   |   |         |   |
|------------------------------------------------------------------------|--------|--------------|--------|--------|-----------|--------|--------|-------------|--------|--------|----------|--------|--------|--------------|--------|
|                                                                   |   | Reserve      |   |   | 2010      |   |   | Write-      |   |   |     |   |   | Reserve      |   |
|                                                                   |   | Balance      |   |   | Charges   |   |   | Downs/      |   |   | Cash     |   |   | Balance      |   |
|                                                                   |   | Feb. 6, 2010 |   |   | (Credits) |   |   | Impairments |   |   | Payments |   |   | Feb. 5, 2011 |   |
|                                                                   |   |         |   |   |      |   |   |        |   |   |     |   |   |         |   |
| Sears fees related to the settlement of the previous license agreement |   | $            | 568    |   |      | $      | -      |        |   | $      | -        |   |   | $            | (150   | ) |   | $ | 418 |   |
| Reserves for severance and related costs                               |   |         | 601    |   |      |   | 538    |        |   |   | -        |   |   |         | (945   | ) |   |   | 194 |   |
| Other                                                                  |   |         | 250    |   |      |   | 1,461  |        |   |   | (120     | )      |   |         | (1,036 | ) |   |   | 555 |   |
|                                                                   |   |         |   |   |      |   |   |        |   |   |     |   |   |         |   |   |   |   |   |   |
| Total                                                                  |   | $            | 1,419  |   |      | $      | 1,999  |        |   | $      | (120     | )      |   | $            | (2,131 | ) |   | $ | 1,167 |   |
|                                                                   |   |         |   |   |      |   |   |        |   |   |     |   |   |         |   |   |   |   |   |   |

| in thousands                                                           |   |         |   |   |      |   |   | Asset       |   |   |     |   |   |         |   |
|------------------------------------------------------------------------|--------|--------------|--------|--------|-----------|--------|--------|-------------|--------|--------|----------|--------|--------|--------------|--------|
|                                                                   |   | Reserve      |   |   | 2009      |   |   | Write-      |   |   |     |   |   | Reserve      |   |
|                                                                   |   | Balance      |   |   | Charges   |   |   | Downs/      |   |   | Cash     |   |   | Balance      |   |
|                                                                   |   | Feb. 7, 2009 |   |   | (Credits) |   |   | Impairments |   |   | Payments |   |   | Feb. 6, 2010 |   |
|                                                                   |   |         |   |   |      |   |   |        |   |   |     |   |   |         |   |
| Sears fees related to the settlement of the previous license agreement |   | $            | 2,218  |   |      | $      | -      |        |   | $      | -        |   |   | $            | (1,650 | ) |   | $ | 568 |   |
| Reserves for severance and related costs                               |   |         | 1,184  |   |      |   | 970    |        |   |   | -        |   |   |         | (1,553 | ) |   |   | 601 |   |
| Other                                                                  |   |         | 1,258  |   |      |   | 626    |        |   |   | (92      | )      |   |         | (1,542 | ) |   |   | 250 |   |
|                                                                   |   |         |   |   |      |   |   |        |   |   |     |   |   |         |   |   |   |   |   |   |
| Total                                                                  |   | $            | 4,660  |   |      | $      | 1,596  |        |   | $      | (92      | )      |   | $            | (4,745 | ) |   | $ | 1,419 |   |
|                                                                   |   |         |   |   |      |   |   |        |   |   |     |   |   |         |   |   |   |   |   |   |

|                                   |   |   |    |   |             |   |   | Weighted-Average      |   |   | Aggregate           |   |
|----------------------------------------|--------|--------|---------|--------|------------------|--------|--------|-----------------------|--------|--------|---------------------|--------|
|                                   |   |   |    |   | Weighted-Average |   |   | Remaining Contractual |   |   | Intrinsic Value (1) |   |
|                                   |   | Shares |    |   | Exercise Price   |   |   | Life (Years)          |   |   | (in thousands)      |   |
| Options outstanding, beginning of year |   |   | 217,500 |   |             | $      | 13.04  |                  |   |   |                |   | $ | - |   |
| Exercised                              |   |   | (23,334 | )      |             |   | 13.58  |                  |   |   |                |   |   | 211 |   |
| Forfeited                              |   |   | (25,000 | )      |             |   | 12.21  |                  |   |   |                |   |   |   |   |
|                                   |   |   |    |   |             |   |   |                  |   |   |                |   |   |   |   |
| Options outstanding, end of year       |   |   | 169,166 |   |             | $      | 13.09  |                  |   |   | 5.79                |   |   | $ | 1,075 |   |
|                                   |   |   |    |   |             |   |   |                  |   |   |                |   |   |   |   |   |
| Options exercisable at end of year     |   |   | 32,501  |   |             | $      | 13.16  |                  |   |   | 6.02                |   |   | $ | 204 |   |

|   (1) | Intrinsic value for activities other than exercises is defined as the difference between the Company's closing stock price on the last trading day of the 2010 fiscal year end and the exercise price, multiplied by the number of in-the-money options.  These amounts change based on the quoted market price of the Company's stock.  For exercises, intrinsic value is defined as the difference between the Company's closing stock price on the exercise date and the exercise price, multiplied by the number of options exercised. |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Expected term until exercise (years)    |   |   | 3.45 - 8.09    |   |
|-----------------------------------------|--------|--------|----------------|--------|
| Expected stock price volatility         |   |   | 41.97% - 52.05 | %      |
| Weighted-average stock price volatility |   |   | 44.23          | %      |
| Expected dividends                      |   |   | 4.71% - 5.24   | %      |
| Risk-free interest rate                 |   |   | 2.55% - 3.59   | %      |

|                                                        |   | 2010   |      |   | 2009                              |   |   | 2008   |   |
|-------------------------------------------------------------|--------|--------|-----------|--------|-----------------------------------|--------|--------|--------|--------|
|                                                        |   | Shares |      |   | Weighted-Average Grant-Date Value |   |   | Shares |   |   | Weighted-Average Grant-Date Value |   |   | Shares |   |   | Weighted-Average Grant-Date Value |   |
| Nonvested stock, beginning of year                          |   |   | 528       |   |                              | $      | 18.95  |   |   |   | 1,056 |   |   | $ | 18.95 |   |   |   | 1,584 |   |   | $ | 18.95 |   |
| Granted                                                     |   |   | 242,783   |   |                              |   | 14.17  |   |   |   | 97,142 |   |   |   | 9.11 |   |   |   | 57,082 |   |   |   | 15.76 |   |
| Vested                                                      |   |   | (150,783  | )      |                              |   | 14.21  |   |   |   | (92,418 | ) |   |   | 9.30 |   |   |   | (53,811 | ) |   |   | 15.79 |   |
| Forfeited                                                   |   |   | (16,407   | )      |                              |   | 13.51  |   |   |   | (5,252 | ) |   |   | 6.70 |   |   |   | (3,799 | ) |   |   | 15.85 |   |
| Nonvested stock, end of year                                |   |   | 76,121    |   |                              | $      | 14.26  |   |   |   | 528 |   |   | $ | 18.95 |   |   |   | 1,056 |   |   | $ | 18.95 |   |
|                                                        |   |   |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Stock-based compensation expense related to nonvested stock |   | $      | 2,466,000 |   |                              |   |   |   |   | $ | 896,000 |   |   |   |   |   |   | $ | 850,000 |   |   |   |   |   |
|                                                        |   |   |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands                                  |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|-----------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                          |   |   |   |   |   |   |   |   |   |
| Profit sharing                                |   | $      | 839    |   |   | $      | 734    |   |   | $ | 590 |   |
| Pension plan expense                          |   |   | 1,202  |   |   |   | 203    |   |   |   | 818 |   |
| Supplemental retirement plan expense (income) |   |   | 1      |   |   |   | (67    | )      |   |   | (903 | ) |
| Total expense, net                            |   | $      | 2,042  |   |   | $      | 870    |   |   | $ | 505 |   |
|                                          |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands |   | Pension Plan |   |   | Supplemental Retirement |   |
|--------------|--------|--------------|--------|--------|-------------------------|--------|
|         |   | Benefits     |   |   | Plan Benefits           |   |
|         |   |         |   |   |                    |   |
| 2011         |   | $            | 2,300  |   |                    | $      | 68 |   |
| 2012         |   | $            | 2,300  |   |                    | $      | 110 |   |
| 2013         |   | $            | 2,400  |   |                    | $      | 110 |   |
| 2014         |   | $            | 2,500  |   |                    | $      | 110 |   |
| 2015         |   | $            | 2,700  |   |                    | $      | 124 |   |
| 2016-2021    |   | $            | 15,600 |   |                    | $      | 621 |   |

|                                        |   | Defined Benefit Plans |    |
|---------------------------------------------|--------|-----------------------|---------|
|                                        |   | Pension Plan          |    |   | Supplemental Retirement Plan |   |
| in thousands                                |   | 2010                  |    |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |
| Projected benefit obligation                |   |                  |    |   |   |   |   |   |   |   |   |   |
| Benefit obligation at beginning of year     |   | $                     | 52,632  |   |   | $ | 42,863 |   |   | $ | 1,351 |   |   | $ | 1,201 |   |
| Interest cost                               |   |                  | 3,066   |   |   |   | 3,090 |   |   |   | 79 |   |   |   | 85 |   |
| Actuarial loss                              |   |                  | 2,099   |   |   |   | 8,750 |   |   |   | 44 |   |   |   | 206 |   |
| Benefit payments                            |   |                  | (2,154  | ) |   |   | (2,071 | ) |   |   | (76 | ) |   |   | (141 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Benefit obligation at end of year           |   | $                     | 55,643  |   |   | $ | 52,632 |   |   | $ | 1,398 |   |   | $ | 1,351 |   |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value of plan assets                   |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value at beginning of year             |   | $                     | 34,909  |   |   | $ | 30,252 |   |   | $ | - |   |   | $ | - |   |
| Actual return on plan assets                |   |                  | 6,406   |   |   |   | 5,168 |   |   |   | - |   |   |   | - |   |
| Employer contributions (1)                  |   |                  | 1,620   |   |   |   | 1,560 |   |   |   | 76 |   |   |   | 141 |   |
| Benefit payments                            |   |                  | (2,154  | ) |   |   | (2,071 | ) |   |   | (76 | ) |   |   | (141 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value at end of year                   |   | $                     | 40,781  |   |   | $ | 34,909 |   |   | $ | - |   |   | $ | - |   |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Funded status                               |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Funded status at end of year                |   | $                     | (14,862 | ) |   | $ | (17,724 | ) |   | $ | (1,398 | ) |   | $ | (1,351 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrecognized net loss (gain)                |   |                  | 20,471  |   |   |   | 22,915 |   |   |   | (246 | ) |   |   | (368 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net amount recognized                       |   | $                     | 5,609   |   |   | $ | 5,191 |   |   | $ | (1,644 | ) |   | $ | (1,719 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Components of consolidated balance sheet    |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accrued benefit liability                   |   | $                     | (14,862 | ) |   | $ | (17,724 | ) |   | $ | (1,398 | ) |   | $ | (1,351 | ) |
| Accumulated other comprehensive loss (gain) |   |                  | 20,471  |   |   |   | 22,915 |   |   |   | (246 | ) |   |   | (368 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net amount recognized                       |   | $                     | 5,609   |   |   | $ | 5,191 |   |   | $ | (1,644 | ) |   | $ | (1,719 | ) |
|                                        |   |                  |    |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1) |   | For the supplemental retirement plan for the fiscal years ended February 5, 2011, and February 6, 2010, the employer contributions were financed through the liquidation of investments in the Company’s Rabbi Trust. |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                   |   |         |   |   | Supplemental    |   |   |   |         |
|--------------------------------------------------------------------------------------------------------|--------|--------------|--------|--------|-----------------|--------|--------|--------|--------------|
| in  thousands                                                                                |   | Pension Plan |   |   | Retirement Plan |   |   | Total  |         |
|                                                                                                   |   |         |   |   |            |   |   |   |         |
| Actuarial (Gain) Loss, net of tax:                                                                     |   |         |   |   |            |   |   |   |    |
|      Unrealized losses (gains) on net actuarial (gain) loss at February 7, 2009    |   | $            | 10,196 |   |            | $      | (450   | )      |         | $ | 9,746 |   |
|      Net actuarial losses (gains) recorded in accumulated other comprehensive loss |   |         | 4,169  |   |            |   | 119    |   |         |   | 4,288 |   |
|      Recognition of net actuarial (losses) gains in earnings                       |   |         | (158   | )      |            |   | 94     |   |         |   | (64 | ) |
|      Unrealized losses (gains) on net actuarial (gain) loss at February 6, 2010    |   | $            | 14,207 |   |            | $      | (237   | )      |         | $ | 13,970 |   |
|      Net actuarial (gains) losses recorded in accumulated other comprehensive loss |   |         | (750   | )      |            |   | 28     |   |         |   | (722 | ) |
|      Recognition of net actuarial (losses) gains in earnings                       |   |         | (765   | )      |            |   | 48     |   |         |   | (717 | ) |
|      Unrealized losses (gains) on net actuarial (gain) loss at February 5, 2011    |   | $            | 12,692 |   |            | $      | (161   | )      |         | $ | 12,531 |   |
|                                                                                                   |   |         |   |   |            |   |   |   |         |   |   |   |

| in thousands                            |   | Pension Plan |   |   | Supplemental Retirement Plan |   |
|-----------------------------------------|--------|--------------|--------|--------|------------------------------|--------|
|                                    |   | 2010         |   |   | 2009                         |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                    |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Components of net periodic benefit cost |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Service cost                            |   | $            | -      |   |                         | $      | - |   |   | $ | 279 |   |   | $ | - |   |   | $ | - |   |   | $ | 71 |   |
| Interest cost                           |   |         | 3,066  |   |                         |   | 3,090 |   |   |   | 2,983 |   |   |   | 79 |   |   |   | 85 |   |   |   | 212 |   |
| Expected return on plan assets          |   |         | (3,098 | )      |                         |   | (3,143 | ) |   |   | (3,242 | ) |   |   | - |   |   |   | - |   |   |   | - |   |
| Amortization of prior service cost      |   |         | -      |   |                         |   | - |   |   |   | 44 |   |   |   | - |   |   |   | - |   |   |   | 31 |   |
| Amortization of net loss (gain)         |   |         | 1,234  |   |                         |   | 256 |   |   |   | 710 |   |   |   | (78 | ) |   |   | (152 | ) |   |   | (59 | ) |
| Curtailment expense (income)            |   |         | -      |   |                         |   | - |   |   |   | 44 |   |   |   | - |   |   |   | - |   |   |   | (469 | ) |
| Net gain due to settlements             |   |         | -      |   |                         |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (689 | ) |
|                                    |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net periodic benefit cost               |   | $            | 1,202  |   |                         | $      | 203 |   |   | $ | 818 |   |   | $ | 1 |   |   | $ | (67 | ) |   | $ | (903 | ) |
|                                    |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

|                                           |   | Pension Plan |   |   | Supplemental Retirement Plan |   |
|------------------------------------------------|--------|--------------|--------|--------|------------------------------|--------|
|                                           |   | 2010         |   |   | 2009                         |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Weighted-average assumptions used to determine |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| benefit obligations at fiscal year end:        |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discount rate                                  |   | 5.65         | %      |   | 6.01                         | %      |   | 7.25 | % |   | 5.65 | % |   | 6.01 | % |   | 7.25 | % |
| Rate of increase in future compensation        |   | N/A          |   |   | N/A                          |   |   | 3.00 | % |   | N/A |   |   | N/A |   |   | 2.00 | % |
| Weighted-average assumptions used to determine |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| net periodic benefit cost:                     |   |         |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Discount rate                                  |   | 6.01         | %      |   | 7.25                         | %      |   | 6.00 | % |   | 6.01 | % |   | 7.25 | % |   | 6.00 | % |
| Expected long-term return on plan assets       |   | 7.75         | %      |   | 7.75                         | %      |   | 8.25 | % |   | N/A |   |   | N/A |   |   | N/A |   |
| Rate of increase in future compensation        |   | N/A          |   |   | N/A                          |   |   | 3.00 | % |   | N/A |   |   | N/A |   |   | 2.00 | % |

| in thousands                                 |   | Pension Plan |   |   | Supplemental Retirement Plan |   |
|----------------------------------------------|--------|--------------|--------|--------|------------------------------|--------|
|                                         |   | 2010         |   |   | 2009                         |   |   | 2010 |   |   | 2009 |   |
|                                         |   |         |   |   |                         |   |   |   |   |   |   |   |
| Projected and accumulated benefit obligation |   | $            | 55,643 |   |                         | $      | 52,632 |   |   | $ | 1,398 |   |   | $ | 1,351 |   |
| Fair value of plan assets                    |   | $            | 40,781 |   |                         | $      | 34,909 |   |   | $ | - |   |   | $ | - |   |

|                      |   | Target     |   |   | Percentage of Plan Assets at |   |
|---------------------------|--------|------------|--------|--------|------------------------------|--------|
| Asset Class               |   | Allocation |   |   | February 5, 2011             |   |   | February 6, 2010 |   |
| Equity securities         |   |       | 50     | %      |                         |   | 55 | % |   |   | 53 | % |
| Fixed income securities   |   |       | 45     | %      |                         |   | 43 | % |   |   | 44 | % |
| Cash and cash equivalents |   |       | 5      | %      |                         |   | 2 | % |   |   | 3 | % |
| Total                     |   |       | 100    | %      |                         |   | 100 | % |   |   | 100 | % |
|                      |   |       |   |   |                         |   |   |   |   |   |   |   |

|                                  |   | 2010   |   |
|---------------------------------------|--------|--------|--------|
| in thousands, except for share data   |   | Total  |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities (1):                |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. large cap                        |   | $      | 13,961 |   |   | $ | 13,961 |   |   | $ | - |   |   | $ | - |   |
| U.S. small cap (2)                    |   |   | 4,016  |   |   |   | 4,016 |   |   |   | - |   |   |   | - |   |
| Non-U.S.                              |   |   | 4,471  |   |   |   | 4,471 |   |   |   | - |   |   |   | - |   |
| Fixed income securities (3):          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. government and agency securities |   |   | 6,135  |   |   |   | - |   |   |   | 6,135 |   |   |   | - |   |
| Corporate bonds and notes (4)         |   |   | 10,556 |   |   |   | 3,672 |   |   |   | 6,884 |   |   |   | - |   |
| Mortgage-backed securities            |   |   | 992    |   |   |   | - |   |   |   | 992 |   |   |   | - |   |
| Cash and cash equivalents (5)         |   |   | 650    |   |   |   | 650 |   |   |   | - |   |   |   | - |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   | $      | 40,781 |   |   | $ | 26,770 |   |   | $ | 14,011 |   |   | $ | - |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

|                                  |   | 2009   |   |
|---------------------------------------|--------|--------|--------|
| in thousands, except for share data   |   | Total  |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities (1):                |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. large cap                        |   | $      | 10,990 |   |   | $ | 10,990 |   |   | $ | - |   |   | $ | - |   |
| U.S. small cap (2)                    |   |   | 4,189  |   |   |   | 4,189 |   |   |   | - |   |   |   | - |   |
| Non-U.S.                              |   |   | 3,560  |   |   |   | 3,560 |   |   |   | - |   |   |   | - |   |
| Fixed income securities (3):          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. government and agency securities |   |   | 9,144  |   |   |   | - |   |   |   | 9,144 |   |   |   | - |   |
| Corporate bonds and notes (4)         |   |   | 4,841  |   |   |   | - |   |   |   | 4,841 |   |   |   | - |   |
| Mortgage-backed securities            |   |   | 1,222  |   |   |   | - |   |   |   | 1,222 |   |   |   | - |   |
| Cash and cash equivalents (5)         |   |   | 963    |   |   |   | 963 |   |   |   | - |   |   |   | - |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   | $      | 34,909 |   |   | $ | 19,702 |   |   | $ | 15,207 |   |   | $ | - |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1) | Investments in mutual funds and exchange traded funds are valued using a market approach based on the net asset value per share multiplied by the number of shares held as of the measurement date.  Investments in common stock are valued using a market approach based on quoted market prices multiplied by the number of shares owned as of the measurement date. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | U.S. small cap equity securities include 67,605 and 173,915 shares of CPI Corp. common stock as of February 5, 2011, and February 6, 2010, respectively. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Fixed income securities are primarily valued using a market approach with inputs that include broker quotes, benchmark yields, reported trades and other observable inputs. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | The Level 1 corporate bonds and notes class as of February 5, 2011, represents an investment in a mutual fund which consists primarily of investment grade debt securities, but may invest a certain percentage of total assets in high-yield securities.  The Level 2 corporate bonds and notes class, as of February 5, 2011 and February 6, 2010, represents investment grade securities of U.S. issuers from diverse industries. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5) | Cash and cash equivalents are primarily held in registered money market funds which are valued using a market approach based on the quoted market prices of identical instruments. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| in thousands                        |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|-------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                |   |   |   |   |   |   |   |   |   |
| Total income tax expense (benefit): |   |   |   |   |   |   |   |   |   |
| Continuing operations               |   | $      | 3,413  |   |   | $      | 5,796  |   |   | $ | (2,644 | ) |
| Discontinued operations             |   |   | -      |   |   |   | -      |   |   |   | (543 | ) |
| Total income tax expense (benefit)  |   | $      | 3,413  |   |   | $      | 5,796  |   |   | $ | (3,187 | ) |
|                                |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands                                                  |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|---------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                          |   |   |   |   |   |   |   |   |   |
| Federal                                                       |   |   |   |   |   |   |   |   |   |
| Current                                                       |   | $      | 236    |   |   | $      | (556   | )      |   | $ | (94 | ) |
| Deferred                                                      |   |   | (217   | )      |   |   | 4,398  |   |   |   | (1,784 | ) |
| Federal income tax                                            |   |   | 19     |   |   |   | 3,842  |   |   |   | (1,878 | ) |
| State                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                                                       |   |   | 472    |   |   |   | 157    |   |   |   | - |   |
| Deferred                                                      |   |   | 158    |   |   |   | 839    |   |   |   | (314 | ) |
| State income tax                                              |   |   | 630    |   |   |   | 996    |   |   |   | (314 | ) |
| Foreign                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                                                       |   |   | 1,957  |   |   |   | -      |   |   |   | - |   |
| Deferred                                                      |   |   | 807    |   |   |   | 958    |   |   |   | (452 | ) |
| Foreign income tax                                            |   |   | 2,764  |   |   |   | 958    |   |   |   | (452 | ) |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Total income tax expense (benefit) from continuing operations |   | $      | 3,413  |   |   | $      | 5,796  |   |   | $ | (2,644 | ) |
|                                                          |   |   |   |   |   |   |   |   |   |   |   |   |

| in thousands                                |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|---------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                        |   |   |   |   |   |   |   |   |   |
| Tax at statutory rate (34%)                 |   | $      | 5,207  |   |   | $      | 6,662  |   |   | $ | (3,184 | ) |
| State income tax, at statutory rate, net of |   |   |   |   |   |   |   |   |   |   |   |   |
| federal income tax (expense) benefit        |   |   | 428    |   |   |   | 657    |   |   |   | (207 | ) |
| Tax effect of:                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses not deductible                     |   |   | 97     |   |   |   | 229    |   |   |   | 370 |   |
| Tax credits and exclusions                  |   |   | (2,381 | )      |   |   | (2,814 | )      |   |   | (798 | ) |
| Valuation allowance                         |   |   | 823    |   |   |   | 109    |   |   |   | 726 |   |
| Foreign taxes                               |   |   | (248   | )      |   |   | 74     |   |   |   | 248 |   |
| Tax settlements                             |   |   | (325   | )      |   |   | 879    |   |   |   | 223 |   |
| Reduction in uncertain tax position         |   |   | (507   | )      |   |   | -      |   |   |   | - |   |
| Other                                       |   |   | 319    |   |   |   | -      |   |   |   | (22 | ) |
|                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| Applicable income tax expense (benefit)     |   | $      | 3,413  |   |   | $      | 5,797  |   |   | $ | (2,644 | ) |
|                                        |   |   |   |   |   |   |   |   |   |   |   |   |

|                                                         |   | 2010   |   |   | 2009   |   |
|--------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Balance at beginning of year                                 |   | $      | 2,660  |   |   |   | 2660 |   |
| Additions based on tax positions related to the current year |   |   | -      |   |   |   | - |   |
| (Reductions) additions for tax positions of prior years      |   |   | (507   | )      |   |   | - |   |
| Reductions related to settlements with taxing authorities    |   |   | -      |   |   |   | - |   |
| Balance at end of year                                       |   | $      | 2,153  |   |   | $      | 2,660 |   |
|                                                         |   |   |   |   |   |   |   |   |

| in thousands                                                           |   | 2010   |   |   | 2009   |   |
|------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
|                                                                   |   |   |   |   |   |   |
| Deferred tax assets                                                    |   |   |   |   |   |   |
| Federal, state and foreign operating and capital loss carryforwards    |   | $      | 2,181  |   |   | $      | 1,733 |   |
| Pension and supplemental retirement plan benefits                      |   |   | 5,685  |   |   |   | 6,788 |   |
| Reserves, principally due to accrual for financial reporting purposes  |   |   | 2,831  |   |   |   | 2,716 |   |
| Federal, state and foreign tax credit carryforwards                    |   |   | 8,708  |   |   |   | 6,988 |   |
| Interest rate swap                                                     |   |   | -      |   |   |   | 759 |   |
| Other                                                                  |   |   | 86     |   |   |   | 40 |   |
|                                                                   |   |   |   |   |   |   |   |   |
| Gross deferred tax assets                                              |   |   | 19,491 |   |   |   | 19,024 |   |
|                                                                   |   |   |   |   |   |   |   |   |
| Deferred tax liabilities                                               |   |   |   |   |   |   |   |   |
| Property and equipment, principally due to differences in depreciation |   |   | (3,258 | )      |   |   | (1,802 | ) |
|                                                                   |   |   |   |   |   |   |   |   |
| Gross deferred tax liabilities                                         |   |   | (3,258 | )      |   |   | (1,802 | ) |
|                                                                   |   |   |   |   |   |   |   |   |
| Valuation allowance                                                    |   |   | (3,091 | )      |   |   | (2,268 | ) |
|                                                                   |   |   |   |   |   |   |   |   |
| Net deferred tax asset                                                 |   | $      | 13,142 |   |   | $      | 14,954 |   |
|                                                                   |   |   |   |   |   |   |   |   |

| 2011                   |   | $      | 1,803  |   |
|------------------------|--------|--------|--------|--------|
| 2012                   |   |   | 1,704  |   |
| 2013                   |   |   | 1,565  |   |
| 2014                   |   |   | 1,419  |   |
| 2015                   |   |   | 1,425  |   |
| Beyond                 |   |   | 504    |   |
| Total minimum payments |   | $      | 8,420  |   |
|                   |   |   |   |   |

| 2011                   |   | $      | 1,236  |   |
|------------------------|--------|--------|--------|--------|
| 2012                   |   |   | 538    |   |
| 2013                   |   |   | 40     |   |
|                   |   |   |   |   |
| Total minimum payments |   | $      | 1,814  |   |
|                   |   |   |   |   |

| in thousands, except per share data                               |   |        |   |
|-------------------------------------------------------------------|--------|-------------|--------|
|                                                              |   |        |   |   |   |   |   |   |   |   |   |   |
| FISCAL YEAR 2010                                                  |   | May 1, 2010 |   |   | July 24, 2010 |   |   | November 13, 2010 |   |   | February 5, 2011 |   |
|                                                              |   | (12 weeks)  |   |   | (12 weeks) |   |   | (16 weeks) |   |   | (12 weeks) |   |
| Net sales                                                         |   | $           | 95,498 |   |   | $ | 76,414 |   |   | $ | 106,174 |   |   | $ | 128,949 |   |
| Gross profit                                                      |   |        | 85,774 |   |   |   | 67,914 |   |   |   | 95,954 |   |   |   | 118,588 |   |
| Net income (loss) attributable to CPI Corp.                       |   |        | 6,540  |   |   |   | (1,817 | ) |   |   | (7,713 | ) |   |   | 14,898 |   |
| Net income (loss) per share attributable to CPI Corp. - diluted   |   | $           | 0.91   |   |   | $ | (0.25 | ) |   | $ | (1.05 | ) |   | $ | 2.06 |   |
| Net income (loss) per share attributable to CPI Corp. - basic     |   | $           | 0.91   |   |   | $ | (0.25 | ) |   | $ | (1.05 | ) |   | $ | 2.07 |   |
| Weighted average number of common and equivalent shares - diluted |   |        | 7,177  |   |   |   | 7,319 |   |   |   | 7,312 |   |   |   | 7,245 |   |
| Weighted average number of common and equivalent shares - basic   |   |        | 7,169  |   |   |   | 7,319 |   |   |   | 7,312 |   |   |   | 7,208 |   |

| in thousands, except per share data                               |   |        |   |
|-------------------------------------------------------------------|--------|-------------|--------|
|                                                              |   |        |   |   |   |   |   |   |   |   |   |   |
| FISCAL YEAR 2009                                                  |   | May 2, 2009 |   |   | July 25, 2009 |   |   | November 14, 2009 |   |   | February 6, 2010 |   |
|                                                              |   | (12 weeks)  |   |   | (12 weeks) |   |   | (16 weeks) |   |   | (12 weeks) |   |
| Net sales                                                         |   | $           | 93,467 |   |   | $ | 81,377 |   |   | $ | 107,286 |   |   | $ | 140,241 |   |
| Gross profit                                                      |   |        | 82,640 |   |   |   | 70,968 |   |   |   | 95,001 |   |   |   | 127,704 |   |
| Net income (loss)                                                 |   |        | 2,329  |   |   |   | (3,429 | ) |   |   | (6,802 | ) |   |   | 21,699 |   |
| Net income (loss) per share - diluted                             |   | $           | 0.34   |   |   | $ | (0.49 | ) |   | $ | (0.97 | ) |   | $ | 3.07 |   |
| Net income (loss) per share - basic                               |   | $           | 0.34   |   |   | $ | (0.49 | ) |   | $ | (0.97 | ) |   | $ | 3.10 |   |
| Weighted average number of common and equivalent shares - diluted |   |        | 6,949  |   |   |   | 7,005 |   |   |   | 7,004 |   |   |   | 7,068 |   |
| Weighted average number of common and equivalent shares - basic   |   |        | 6,949  |   |   |   | 7,005 |   |   |   | 7,004 |   |   |   | 7,008 |   |

Item

Item

| a)   | Evaluation of Disclosure Controls and Procedures |
|----------------|--------------------------------------------------|

| b)   | Management’s Assessment of Internal Control Over Financial Reporting |
|----------------|----------------------------------------------------------------------------|

| c)   | Changes in Internal Control Over Financial Reporting |
|----------------|------------------------------------------------------|

| d)   | Report of Independent Registered Public Accounting Firm |
|----------------|---------------------------------------------------------|

Item

Item

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

|                          |   |                          |    |                    |   | Number of securities            |   |   |    |
|-------------------------------|--------|-------------------------------|---------|-------------------------|--------|---------------------------------|--------|--------|---------|
|                          |   |                          |    |                    |   | remaining available for         |   |   |    |
|                          |   | Number of securities to be    |    | Weighted-average        |   | future issuance under equity    |   |   |    |
|                          |   | issued upon exercise of       |    | exercise price of       |   | compensation plans              |   |   |    |
|                          |   | outstanding options, warrants |    | outstanding options,    |   | (excluding securities reflected |   |   |    |
| Plan Category                 |   | and rights (a)                |    | warrants and rights (b) |   | in column (a)) (c)              |   |   |    |
| Equity compensation plans     |   |                          |    |                    |   |                            |   |   |    |
| approved by security holders  |   |                          | 169,166 |                    | $      | 13.09                           |   |   | 545,313 |   | (1) |   |
| Equity compensation plans not |   |                          |    |                    |   |                            |   |   |    |   |   |   |
| approved by security holders  |   |                          | -       |                    |   | -                               |   |   | -       |   |   |   |
| Total                         |   |                          | 169,166 |                    | $      | 13.09                           |   |   | 545,313 |   |   |   |
|                          |   |                          |    |                    |   |                            |   |   |    |   |   |   |

| (1) |   | Represents total shares of common stock available for issuance pursuant to awards under the Company’s Omnibus Incentive Plan, effective May 29, 2008.  See Note 13 for further discussion of this plan. |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Item

Item

Item

|   |   (1.) | FINANCIAL STATEMENTS |   | PAGES                                                                     |
|--------|-------------|----------------------|--------|---------------------------------------------------------------------------|
|   |        |                 |   |                                                                      |   |
|   |        | -                    |   | Report of Independent Registered Public Accounting Firm                   |   | 31 |
|   |        | -                    |   | Consolidated Balance Sheets as of February 5, 2011, and February 6, 2010  |   | 32-33 |
|   |        | -                    |   | Consolidated Statements of Operations for the fiscal years ended          |   |   |
|   |        |                 |   | February 5, 2011, February 6, 2010, and February 7, 2009                  |   | 34 |
|   |        | -                    |   | Consolidated Statements of Changes in Stockholders' Equity for the fiscal |   |   |
|   |        |                 |   |                                                                      | years ended February 5, 2011, February 6, 2010, and February 7, 2009 |   | 35 |
|   |        | -                    |   | Consolidated Statements of Cash Flows for the fiscal years ended          |   |   |
|   |        |                 |   |                                                                      | February 5, 2011, February 6, 2010, and February 7, 2009 |   | 36-38 |
|   |        | -                    |   | Notes to Consolidated Financial Statements                                |   | 39-66 |

| (a)   | EXHIBIT INDEX |
|-----------------|---------------|

| EXHIBIT |   |                                                                                                                                 |
|---------|--------|--------------------------------------------------------------------------------------------------------------------------------------|
| NUMBER  |   | DESCRIPTION                                                                                                                          |
|    |   |                                                                                                                                 |
| (3.1)   |   | Articles of Incorporation of the Company, incorporated by reference to CPI Corp.'s Annual Report for fiscal year 1989 on             |
|    |   | Form 10-K, Exhibit 3.1, filed April 30, 1990.                                                                                        |
|    |   |                                                                                                                                 |
| (3.2)   |   | Amended and Restated By-laws of the Company,  effective November 24, 2008, and incorporated by reference to CPI Corp.'s    |
|    |   | Form 8-K, Exhibit 3.1, filed December 1, 2008.                                                                                       |
|    |   |                                                                                                                                 |
| (4.1)   |   | Form of Rights Agreement, dated as of March 13, 2000, between CPI Corp. and Harris Trust and Savings Bank, incorporated              |
|    |   | by reference to CPI Corp.'s Form 8-A, Exhibit 4.5, dated March 14, 2000.                                                             |
|    |   |                                                                                                                                 |
| (4.2)   |   | First Amendment to Form of Rights Agreement, dated September 5, 2007, by and between CPI Corp. and Computershare                     |
|    |   | Trust Company, N.A., incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 4.1, filed September 6, 2007.                        |
|    |   |                                                                                                                                 |
| (4.3)   |   | Second Amendment to Form of Rights Agreement, dated December 21, 2007, by and between CPI Corp. and Computershare                    |
|    |   | Trust Company, N.A., incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 4.1, filed December 21, 2007.                        |
|    |   |                                                                                                                                 |
| (4.4)   |   | Third Amendment to Form of Rights Agreement, dated March 12, 2010, by and between CPI Corp. and Computershare Trust                  |
|    |   | Company, N.A., incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.1, filed March 18, 2010.                                |
|    |   |                                                                                                                                 |
| (10.1)  |   | License Agreement Sears, Roebuck De Puerto Rico, Inc., dated January 1, 1999, incorporated by reference to CPI Corp.'s               |
|    |   | Annual Report for fiscal year 1998 on Form 10-K, Exhibit 10.30, filed May 5, 1999.                                                   |
|    |   |                                                                                                                                 |
| (10.2)* |   | Employment Agreement dated December 31, 2008, by and between Jane E. Nelson and CPI Corp., incorporated by reference to              |
|    |   | CPI Corp.'s Form 8-K, Exhibit A within Exhibit 10.67, filed January 7, 2009.                                                         |
|    |   |                                                                                                                                 |
| (10.3)* |   | CPI Corp. 1981 Stock Bonus Plan (As Amended and Restated effective February 3, 1991), incorporated by reference to                   |
|    |   | CPI Corp.'s Annual Report for fiscal year 1992 on Form 10-K, Exhibit 10.29, filed May 5, 1993.                                       |
|    |   |                                                                                                                                 |
| (10.4)* |   | First Amendment to CPI Corp. 1981 Stock Bonus Plan (As Amended and Restated effective February 3, 1991) effective                    |
|    |   | January 1, 1995, incorporated by reference to CPI Corp.'s Annual Report for fiscal year 2000 on  Form 10-K, Exhibit 10.30, |
|    |   | filed May 3, 2001.                                                                                                                   |
|    |   |                                                                                                                                 |
| (10.5)* |   | CPI Corp. Restricted Stock Plan as Amended and Restated effective as of April 14, 2005, incorporated by reference to CPI             |
|    |   | Corp.'s Annual Report for fiscal year 2004 on Form 10-K, Exhibit 10.86, filed April 21, 2005.                                        |
|    |   |                                                                                                                                 |
| (10.6)* |   | CPI Corp. Performance Plan adopted effective as of April 14, 2005, incorporated by reference to CPI Corp.'s Annual Report            |
|    |   | for fiscal year 2004  on Form 10-K, Exhibit 10.90, filed April 21, 2005.                                                   |

| EXHIBIT  |   |                                                                                                                            |
|----------|--------|---------------------------------------------------------------------------------------------------------------------------------|
| NUMBER   |   | DESCRIPTION                                                                                                                     |
|     |   |                                                                                                                            |
| (10.7)*  |   | CPI Corp. Non-Employee Directors Restricted Stock Policy pursuant to the CPI Corp. Omnibus Incentive Plan effective as of       |
|     |   | August 14, 2008, incorporated by reference to CPI Corp.'s Annual Report for fiscal year 2008 on Form 10-K, Exhibit 10.31,       |
|     |   | filed April 23, 2009.                                                                                                           |
|     |   |                                                                                                                            |
| (10.8)*  |   | CPI Corp. Non-Employee Directors Restricted Stock Policy (Restricted Stock Election), effective August 14, 2008, incorporated   |
|     |   | by reference to CPI Corp.'s Annual Report for fiscal year 2008 on Form 10-K, Exhibit 10.33, filed April 23, 2009.               |
|     |   |                                                                                                                            |
| (10.9)*  |   | Form of Option Agreement, incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.1, filed August 21, 2008.               |
|     |   |                                                                                                                            |
| (10.10)* |   | CPI Corp. Omnibus Incentive Plan, incorporated by reference to CPI Corp.'s Form DEF 14A, Annex A, filed June 23, 2008.          |
|     |   |                                                                                                                            |
| (10.11)* |   | Employment Agreement by and between CPI Corp. and Renato Cataldo, incorporated by reference to CPI Corp.'s Form 10-Q,           |
|     |   | Exhibit 10.10, filed September 1, 2005.  File No.  1-10204                                                  |
|     |   |                                                                                                                            |
| (10.12)* |   | Confidentiality, Noncompetition and Nonsolicitation Agreement by and between CPI Corp. and Renato Cataldo, incorporated         |
|     |   | by reference to CPI Corp.'s Form 10-Q, Exhibit 10.104, filed September 1, 2005.                                                 |
|     |   |                                                                                                                            |
| (10.13)* |   | Letter from the Company regarding Supplemental Retirement Benefits, dated June 28, 2006, delivered to Richard Tarpley,          |
|     |   | incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.61, filed July 5, 2006.                                           |
|     |   |                                                                                                                            |
| (10.14)* |   | Letter from the Company regarding Supplemental Retirement Benefits, dated June 28, 2006, delivered to Jane E. Nelson,           |
|     |   | incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.62, filed July 5, 2006.                                           |
|     |   |                                                                                                                            |
| (10.15)* |   | Employment Agreement dated September 12, 2007, by and between Thomas Gallahue and CPI Corp., incorporated by                    |
|     |   | reference to CPI Corp.'s Form 8-K, Exhibit 10.60, filed September 18, 2007.                                                     |
|     |   |                                                                                                                            |
| (10.16)  |   | Purchase and Sale Agreement dated as of May 1, 2007, by and among Portrait Corporation of America, PCA LLC, American            |
|     |   | Studios, Inc., PCA Photo Corporation of Canada, PCA National LLC, PCA Finance Corp., Inc., Photo Corporation of                 |
|     |   | America, Inc., (each, a "Seller") and CPI Corp., incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 2.1, filed          |
|     |   | May 3, 2007.                                                                                                                    |
|     |   |                                                                                                                            |
| (10.17)  |   | Amendment No. 1 to the Purchase and Sale Agreement dated as of May 1, 2007, by and among Portrait Corporation of America,       |
|     |   | PCA LLC, American Studios, Inc., PCA Photo Corporation of Canada, PCA National LLC, PCA Finance Corp., Inc., Photo              |
|     |   | Corporation of America, Inc., (each, a "Seller") and CPI Corp., such amendment effective as of May 21, 2007, incorporated by    |
|     |   | reference to CPI Corp.'s Form 8-K, Exhibit 2.1, filed May 25, 2007.                                                             |
|     |   |                                                                                                                            |
| (10.18)  |   | Amendment No. 2 to the Purchase and Sale Agreement dated as of June 8, 2007, by and among Portrait Corporation of America,      |
|     |   | PCA LLC, American Studios, Inc., PCA Photo Corporation of Canada, PCA National LLC, PCA Finance Corp., Inc., Photo              |
|     |   | Corporation of America, Inc., (each, a "Seller") and CPI Corp., incorporated by reference to CPI Corp.'s Form 8-K,              |
|     |   | Exhibit 2.3, filed June 24, 2007.                                                                                               |
|     |   |                                                                                                                            |
| (10.19)  |   | Second Amended and Restated Credit Agreement dated as of June 8, 2007, among the Company, the financial institutions that       |
|     |   | are or may from time to time become parties thereto and LaSalle Bank National Association, as administrative agent and arranger |
|     |   | for the lenders, incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.1, filed June 14, 2007.                          |
|     |   |                                                                                                                            |
| (10.20)  |   | First Amendment to that certain Second Amended and Restated Credit Agreement, among the Company, the financial institutions     |
|     |   | that are or may from time to time become parties thereto and LaSalle Bank National Association, as administrative agent and     |
|     |   | arranger for the lenders, dated June 8, 2007, filed within this Form 10-K as Exhibit 10.28.                                     |

| EXHIBIT  |   |                                                                                                                                     |
|----------|--------|------------------------------------------------------------------------------------------------------------------------------------------|
| NUMBER   |   | DESCRIPTION                                                                                                                              |
|     |   |                                                                                                                                     |
| (10.21)  |   | Second Amendment to that certain Second Amended and Restated Credit Agreement, among the Company, the financial                          |
|     |   | institutions that are or may from time to time become parties thereto and LaSalle Bank National Association, as administrative           |
|     |   | agent and arranger for the lenders, dated December 10, 2008, incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.1,            |
|     |   | filed December 19, 2008.                                                                                                                 |
|     |   |                                                                                                                                     |
| (10.22)  |   | Third Amendment to that certain Second Amended and Restated Credit Agreement, among the Company, the financial                           |
|     |   | institutions that are or may from time to time become partites thereto and Bank of America, N.A., as successor to LaSalle Bank           |
|     |   | National Association, as administrative agent and arranger for the lenders, effective April 16, 2009, incorproated by reference to       |
|     |   | CPI Corp.'s Form 8-K, Exhibit 10.47, filed April 21, 2009.                                                                               |
|     |   |                                                                                                                                     |
| (10.23)  |   | Master Lease Agreement between Wal-Mart Stores  East, L.P., Wal-Mart Stores, Inc., Wal-Mart Louisiana, LLC, Wal-Mart           |
|     |   | Stores Texas, LP and Portrait Corporation of America, Inc., effective June 8, 2007, incorporated by reference to CPI Corp.'s             |
|     |   | Form 10-Q, Exhibit 10.59, filed August 30, 2007.  (Confidential treatment requested for portions of this document).            |
|     |   |                                                                                                                                     |
| (10.24)  |   | First Amendment to the Master Lease Agreement between Wal-Mart Stores, East, LP, Wal-Mart Stores, Inc., Wal-Mart                         |
|     |   | Louisiana, LLC, Wal-Mart Stores Texas, LP and Portrait Corporation of America, Inc., effective June 8, 2007, incorporated by             |
|     |   | reference to CPI Corp.'s Form 10-Q, Exhibit 10.60, filed December 20, 2007.                                                              |
|     |   |                                                                                                                                     |
| (10.25)  |   | Second Amendment to the Master Lease Agreement between Wal-Mart Stores, East, LP, Wal-Mart Stores, Inc., Wal-Mart                        |
|     |   | Louisiana, LLC, Wal-Mart Stores Texas, LP and Portait Corporation of America, Inc., effective June 8, 2007, incorporated by              |
|     |   | reference to CPI Corp.'s Form 10-Q, Exhibit 10.61, filed December 20, 2007.                                                              |
|     |   |                                                                                                                                     |
| (10.26)  |   | License Agreement dated December 22, 2008, by and between CPI Corp., Consumer Programs Incorporated, a subsidiary of                     |
|     |   | Company, and Sears, Roebuck and Co. (confidential treatment requested for portions of this document), incorporated by                    |
|     |   | reference to CPI Corp.'s Form 8-K, Exhibit 10.1, filed December 24, 2008.                                                                |
|     |   |                                                                                                                                     |
| (10.27)  |   | Letter Agreement dated December 22, 2008, by and between CPI Corp., Consumer Programs Incorporated, a subsidiary of                      |
|     |   | the Company, and Sears, Roebuck and Co., incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.2, filed                          |
|     |   | December 24, 2008.                                                                                                                       |
|     |   |                                                                                                                                     |
| (10.28)* |   | Employment Agreement by and between CPI Corp. and Dale Heins, dated April 23, 2008, incorporated by reference to                         |
|     |   | CPI Corp.'s Form 8-K, Exhibit 10.62, filed April 24, 2008.                                                                               |
|     |   |                                                                                                                                     |
| (10.29)* |   | Employment Agreement by and between CPI Corp. and Jim Mills, dated September 2, 2008, incorporated by reference to                       |
|     |   | CPI Corp.'s Form 10-Q, Exhibit 10.65, filed December 18, 2008.                                                                           |
|     |   |                                                                                                                                     |
| (10.30)* |   | Chairman's Agreement by and between CPI Corp. and David Meyer, dated September 22, 2008, incorporated by reference to                    |
|     |   | CPI Corp.'s Form 10-Q, Exhibit 10.66, filed December 18, 2008.                                                                           |
|     |   |                                                                                                                                     |
| (10.31)* |   | Amendment to Chairman's Agreement by and between CPI Corp. and David Meyer, dated September 25, 2009, incorporated by                    |
|     |   | reference to CPI Corp.'s Form 10-Q, Exhibit 10.58, filed December 22, 2009.  (Confidential treatment requested for portions of |
|     |   | this document.)                                                                                                                          |
|     |   |                                                                                                                                     |
| (10.32)* |   | Amendment to Chairman's Agreement dated September 22, 2008, and amended September 25, 2009, by and between CPI Corp.                     |
|     |   | and David Meyer, dated February 12, 2010, incorporated by reference to CPI Corp.'s Form 10-K, Exhibit 10.40, filed April 22, 2010.       |
|     |   |                                                                                                                                     |
| (10.33)* |   | Executive Chairman's Agreement by and between CPI Corp. and David Meyer, dated April 19, 2010, incorporated by reference to              |
|     |   | CPI Corp.'s Form 10-K, Exhibit 10.41, filed April 22, 2010. (Confidential treatment requested for portions of this document.)            |
|     |   |                                                                                                                                     |
| (10.34)  |   | Amendment dated as of February 22, 2010, by and between CPI Corp. and Toys "R" Us - Delaware, Inc. ("Licensor") to the                   |
|     |   | Amended and Restated License Agreement made and entered into as of December 23, 2005, by and between Licensor and                        |
|     |   | Kiddie Kandids, LLC.  Amended and Restated License Agreement made and entered into as of December 23, 2005, by and             |
|     |   | between Licensor and Kiddie Kandids, LLC.  These documents are incorporated by reference to CPI Corp.'s  Form 10-K,  |
|     |   | Exhibit 10.42, filed April 22, 2010.  (Confidential treatment requested for portions of these documents.)                      |

| EXHIBIT  |   |                                                                                                                          |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------|
| NUMBER   |   | DESCRIPTION                                                                                                                   |
|     |   |                                                                                                                          |
| (10.35)* |   | Employment Agreement by and between CPI Corp. and Keith Laakko, dated December 28, 2005, incorporated by reference to         |
|     |   | CPI Corp.'s Form 10-K, Exhibit 10.43, filed April 22, 2010.                                                                   |
|     |   |                                                                                                                          |
| (10.36)* |   | Confidentiality, Noncompetition and Nonsolicitation Agreement by and between CPI Corp. and Keith Laakko, dated                |
|     |   | December 28, 2005, incorporated by reference to CPI Corp.'s Form 10-K, Exhibit 10.44, filed April 22, 2010.                   |
|     |   |                                                                                                                          |
| (10.37)* |   | First Amendment to Employment Agreement by and between CPI Corp. and Keith Laakko, dated December 30, 2005, incorporated      |
|     |   | by reference to CPI Corp.'s Form 10-K, Exhibit 10.45, filed April 22, 2010.                                                   |
|     |   |                                                                                                                          |
| (10.38)* |   | Amended and Restated CPI Corp. Retirement Plan, effective January 1, 2010, incorporated by reference to CPI Corp.'s           |
|     |   | Form 10-K, Exhibit 10.46, filed April 22, 2010.                                                                               |
|     |   |                                                                                                                          |
| (10.39)* |   | CPI Corp. Non-Employee Directors Restricted Stock Award Agreement pursuant to the CPI Corp. Omnibus Incentive Plan            |
|     |   | effective as of April 15, 2010, incorporated by reference to CPI Corp.'s Form 10-Q, Exhibit 10.47, filed June 9, 2010.        |
|     |   |                                                                                                                          |
| (10.40)* |   | Restricted Stock Award Agreement pursuant to the Executive Chariman's Agreement by and between CPI Corp. and David            |
|     |   | Meyer, dated April 19, 2010, incorporated by reference to CPI Corp.'s Form 10-Q, Exhibit 10.48, filed June 9, 2010.           |
|     |   |                                                                                                                          |
| (10.41)  |   | Credit Agreement dated as of August 30, 2010, among the Company, the financial institutions that are or may from time to time |
|     |   | become parties thereto and Bank of America, N.A., as administrative agent for the lenders, and as swing line lender and       |
|     |   | issuing lender, incorporated by reference to CPI Corp.'s Form 10-Q, Exhibit 10.49, filed September 2, 2010.                   |
|     |   |                                                                                                                          |
| (10.42)* |   | Separation and Release Agreement by and between Consumer Programs Incorporated and James Mills entered into as of             |
|     |   | September 1, 2010, effective as of August 13, 2010, incorporated by reference to CPI Corp.'s Form 10-Q, Exhibit 10.50,        |
|     |   | filed September 2, 2010.                                                                                                      |
|     |   |                                                                                                                          |
| (10.43)  |   | Amendment No. 3 dated September 8, 2010, effective as of April 15, 2008, to the Master Lease Agreement, dated as of           |
|     |   | June 8, 2007, as amended on June 20, 2007 and August 20, 2007 (the "Master Lease"), by and between the Company and            |
|     |   | Wal-Mart Stores East, LP, a Delaware limited partnership, Wal-Mart Stores, Inc., a Delaware corporation, Wal-Mart             |
|     |   | Louisiana, LLC, a Delaware limited liability company, and Wal-Mart Stores Texas, LLC, a Texas limited partnership,            |
|     |   | incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.2, filed September 14, 2010.                                    |
|     |   |                                                                                                                          |
| (10.44)  |   | Amendment No. 4 dated September 8, 2010, effective as of October 30, 2009, to the Master Lease Agreement, dated as of         |
|     |   | June 8, 2007, as amended on June 20, 2007 and August 20, 2007 (the "Master Lease"), by and between the Company and            |
|     |   | Wal-Mart Stores East, LP, a Delaware limited partnership, Wal-Mart Stores, Inc., a Delaware corporation, Wal-Mart             |
|     |   | Louisiana, LLC, a Delaware limited liability company, and Wal-Mart Stores Texas, LLC, a Texas limited partnership,            |
|     |   | incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.3, filed September 14, 2010.  (Confidential treatment |
|     |   | requested for portions of this document.)                                                                                     |
|     |   |                                                                                                                          |
| (10.45)  |   | Amendment No. 5 dated September 8, 2010, effective as of June 3, 2010, to the Master Lease Agreement, dated as of             |
|     |   | June 8, 2007, as amended on June 20, 2007 and August 20, 2007 (the "Master Lease"), by and between the Company and            |
|     |   | Wal-Mart Stores East, LP, a Delaware limited partnership, Wal-Mart Stores, Inc., a Delaware corporation, Wal-Mart             |
|     |   | Louisiana, LLC, a Delaware limited liability company, and Wal-Mart Stores Texas, LLC, a Texas limited partnership,            |
|     |   | incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.4, filed September 14, 2010.  (Confidential treatment |
|     |   | requested for portions of this document.)                                                                                     |
|     |   |                                                                                                                          |
| (10.46)  |   | Amendment No. 6 dated September 8, 2010, effective as of July 1, 2010, to the Master Lease Agreement, dated as of             |
|     |   | June 8, 2007, as amended on June 20, 2007 and August 20, 2007 (the "Master Lease"), by and between the Company and            |
|     |   | Wal-Mart Stores East, LP, a Delaware limited partnership, Wal-Mart Stores, Inc., a Delaware corporation, Wal-Mart             |
|     |   | Louisiana, LLC, a Delaware limited liability company, and Wal-Mart Stores Texas, LLC, a Texas limited partnership,            |
|     |   | incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.5, filed September 14, 2010.  (Confidential treatment |
|     |   | requested for portions of this document.)                                                                                     |
|     |   |                                                                                                                          |
| (10.47)* |   | Form of LTIP Restricted Stock Award Agreement, incorporated by reference to CPI Corp.'s Form 10-Q, Exhibit 10.51,             |
|     |   | filed December 22, 2010.                                                                                                      |
|     |   |                                                                                                                          |
| (10.48)  |   | Asset Purchase Agreement dated January 26, 2011, by and among Bella Pictures Holdings, LLC, a Delaware limited liability      |
|     |   | company (the "Buyer"), Bella Pictures, Inc., a Delaware corporation (the "Company"), CPI Corp., a Delaware corporation        |
|     |   | ("CPI"), and, with respect to Sections 4.3, 4.5, 4.6, 4.7, 6.1, 6.3, 6.4 and 6.7 and Article 7 of the Agreement only,         |
|     |   | Foundation Capital IV, L.P. ("Foundation Capital"), incorporated by reference to CPI Corp.'s Form 8-K, Exhibit 10.6,          |
|     |   | filed February 1, 2011.                                                                                                       |

| EXHIBIT  |   |                                                                                                                          |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------|
| NUMBER   |   | DESCRIPTION                                                                                                                   |
|     |   |                                                                                                                          |
| (10.49)* |   | Letter dated March 18, 2011, confirming agreement between CPI Corp. and David M. Meyer regarding compensation as              |
|     |   | Executive Chairman of the Board of Directors of the Company during fiscal year ended February 4, 2012, incorporated by        |
|     |   | reference to CPI Corp.'s Form 8-K, Exhibit 10.52, filed March 24, 2011.                                                       |
|     |   |                                                                                                                          |
| (10.50)* |   | Form of First Amendment to Offer of Employment, dated December 30, 2010, filed within this Form 10-K as Exhibit 10.50.        |
|     |   |                                                                                                                          |
| (11.1)   |   | Computation of Income (Loss) Per Share - Diluted                                                                              |
|     |   |                                                                                                                          |
| (11.2)   |   | Computation of Income (Loss) Per Share - Basic                                                                                |
|     |   |                                                                                                                          |
| (21.0)   |   | Subsidiaries of the Registrant                                                                                                |
|     |   |                                                                                                                          |
| (23.0)   |   | Independent Registered Public Accounting Firm's Consent                                                                       |
|     |   |                                                                                                                          |
| (31.1)   |   | Certification Pursuant to Rule 13a-14(a) Under the Securities and Exchange Act of 1934 by the President and Chief Executive   |
|     |   | Officer.                                                                                                                      |
|     |   |                                                                                                                          |
| (31.2)   |   | Certification Pursuant to Rule 13a-14(a) Under the Securities and Exchange Act of 1934 by the Executive Vice President,       |
|     |   | Finance and Chief Financial Officer.                                                                                          |
|     |   |                                                                                                                          |
| (32.0)   |   | Certification Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the |
|     |   | President and Chief Executive Officer and the Executive Vice President, Finance and Chief Financial Officer.                  |
|     |   |                                                                                                                          |
| *        |   | Management contract or compensatory plan available to employees, officers or directors.                                       |
|     |   |                                                                                                                          |

SIGNATURES

|   | CPI CORP. |                                  |
|--------|-----------|---------------------------------------|
|   |      |                                  |   |
|   | By:       | /s/Renato Cataldo                     |   |
|   |      | Renato Cataldo                        |   |
|   |      | President and Chief Executive Officer |   |
|   |      |                                  |   |

| SIGNATURES OF DIRECTORS AND PRINCIPAL OFFICERS |
|------------------------------------------------|
|                                           |
|                                           | Signature |   | Title |   | Date |
|                                           |
|                                           | /s/ |   | Renato Cataldo |   | President and Chief Executive Officer |   | April 21, 2011 |
|                                           |   |   | (Renato Cataldo) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | David M. Meyer |   | Executive Chairman of the Board of Directors | April 21, 2011 |
|                                           |   |   | (David M. Meyer) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | James J. Abel |   | Director |   | April 21, 2011 |
|                                           |   |   | (James J. Abel) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | Michael S. Koeneke |   | Director |   | April 21, 2011 |
|                                           |   |   | (Michael S. Koeneke) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | Michael Glazer |   | Director |   | April 21, 2011 |
|                                           |   |   | (Michael Glazer) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | John Turner White, IV |   | Director |   | April 21, 2011 |
|                                           |   |   | (John Turner White, IV) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | Eric Salus |   | Director |   | April 21, 2011 |
|                                           |   |   | (Eric Salus) |   |   |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | Dale Heins |   | Executive Vice President, Finance, |   | April 21, 2011 |
|                                           |   |   | (Dale Heins) |   | Chief Financial Officer and Treasurer |   |   |
|                                           |   |   |   |   |   |   |   |
|                                           | /s/ |   | Rose O'Brien |   | Vice President, Corporate Controller |   | April 21, 2011 |
|                                           |   |   | (Rose O'Brien) |   | and Principal Accounting Officer |   |   |