Using $fgetc to read characters in verilog

[anhnha]

Hi all,
I am learning verilog and this is a module used for read a character:

module file_read()

parameter EOF = -1;

integer file_handle,error,indx;
reg signed [15:0] wide_char;
reg [7:0] mem[0:255];
reg [639:0] err_str;

initial begin
  indx=0;
  file_handle = $fopen(“text.txt”,”r”);
  error = $ferror(file_handle,err_str);
  if (error==0) begin
    wide_char = 16’h0000;
    while (wide_char!=EOF) begin
       wide_char = $fgetc(file_handle);
      mem[indx] = wide_char[7:0];
      $write(“%c”,mem[indx]);
      indx = indx + 1;
    end
  end
  else $display(“Can’t open file…”);
  $fclose(file_handle);
end
endmodule

I have a problem in understanding the code, hope anyone can help me out.
1) Why we need wide_char[15:0] and why signed? A character is only one byte(8 bits)
2) What is reg [639:0] err_str is used for? And why here is [639:0], where it come from?
Thank you.