8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): November 22, 2004

PACIFIC SUNWEAR OF CALIFORNIA, INC.

(Exact Name of Registrant as Specified in Charter)

California
(State or Other Jurisdiction of Incorporation) 0-21296
(Commission File Number) 95-3759463
(IRS Employer Identification No.)

3450 East Miraloma Avenue
Anaheim, CA
(Address of principal executive offices) 92806-2101
(Zip Code)

(714) 414-4000
Registrant’s telephone number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

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

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

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

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

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TABLE OF CONTENTS

EXHIBIT 10.1

EXHIBIT 10.2

EXHIBIT 99.1

Item 1.01 Entry into a Material Definitive Agreement.

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

     On November 19, 2004, Pacific Sunwear of California, Inc. (the “Company”) announced the appointment of Gerald M. Chaney, 57, to the position of Senior Vice President and Chief Financial Officer, effective Thursday, December 2, 2004. The full text of the press release is included as Exhibit 99.1 to this report and is incorporated herein by reference.

     Mr. Chaney served as Senior Vice President of Finance and Chief Financial Officer of Polo Ralph Lauren Corporation from November 2000 through November 2004, and as Senior Vice President of Finance and Chief Financial Officer of Kellwood Company from December 1998 to November 2000.

     Under the terms of an offer letter, Mr. Chaney’s annual base salary will be $550,000. Mr. Chaney will receive a guaranteed bonus of $250,000 for fiscal 2004, and thereafter be eligible for a target bonus of 50% of base salary and a maximum of 100% of base salary (80% of which is earnings related and 20% of which is individual performance based). Mr. Chaney will be granted nonqualified stock options to purchase 100,000 shares of Common Stock December 2, 2004 with an exercise price equal to fair market value on that date and vesting 25% on the first anniversary of the date of grant with the balance vesting over the following 36 months in equal monthly installments. In addition, Mr. Chaney will be granted 25,000 additional shares of nonqualified stock options at the time annual grants are made to employees in calendar 2005. These additional options will have an exercise price equal to fair market value on the grant date and have similar vesting terms. The full text of the offer letter is included as Exhibit 10.1 to this report and is incorporated herein by reference.

     The Company and Mr. Chaney have also entered into a severance agreement as of November 22, 2004. If the Company terminates Mr. Chaney without cause, he will be eligible to receive continued payment of his base salary for a period of twelve (12) months following the date of termination, subject to mitigation for any amounts earned by Executive from a subsequent employer. In addition, if Mr. Chaney is terminated without cause during the fourth fiscal quarter of the year, the Company will pay Mr. Chaney within 90 days of the end of the Company’s fiscal year, a pro rata portion of the bonus payment that would otherwise have been received by him for that year. The full text of the severance agreement is included as Exhibit 10.2 to this report and is incorporated herein by reference.

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Item 9.01 Financial Statements and Exhibits.

     (c) Exhibits.

10.1	Offer Letter dated November 22, 2004, between the Company and Gerald M. Chaney
10.2	Severance Agreement, dated November 22, 2004, between the Company and Gerald M. Chaney
99.1	Press Release issued by the Company on November 19, 2004

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SIGNATURES

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

Dated: November 24, 2004	Pacific Sunwear of California, Inc.
	/s/ GREG H. WEAVER Greg H. Weaver Chairman of the Board and Chief Executive Officer

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EXHIBIT INDEX

Exhibit No.	Description
10.1	Offer Letter dated November 22, 2004, between the Company and Gerald M. Chaney
10.2	Severance Agreement, dated November 22, 2004, between the Company and Gerald M. Chaney
99.1	Press Release issued by the Company on November 19, 2004

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EX-10.1

EXHIBIT 10.1

3450 East Miraloma Avenue, Anaheim, CA 92806-2101
(714) 414-4000
pacsun.com

October 25, 2004

Gerald M. Chaney
125 Deer Trail North
Ramsey, New Jersey 07446

Dear Gerry:

I am extremely pleased to offer you the position of Senior Vice President/Chief Financial Officer of Pacific Sunwear of California, Inc. (“The Company”). In this position, you will be part of the Executive Committee of the Company. Your start date is to be no later than December 2, 2004. The following are points pertaining to your employment:

1.	Your annual salary will be $550,000. You will be eligible to receive a performance and salary review for fiscal 2005. Said review is conducted and is generally effective during March/April 2006, and annually thereafter.
2.	You will be eligible for our 2005 bonus plan. Any bonus payments will be made in or around April 2006. Your target bonus potential is 50% of your salary based on both Company earnings for the fiscal year and on your individual performance (80% of the bonus is earnings-related and 20% is discretionary, based on your individual performance). The Company bonus has a potential upside of 200% (i.e., 100% of your salary, with the same distribution of 80% based on earnings and 20% based on individual performance). You must be employed on the date the bonus is paid in order to be eligible for any part of your bonus. The bonus is calculated based on the fiscal year’s performance of the Company. The bonus plan can change in future years.
3.	For fiscal 2004, you will be guaranteed a bonus payment in the amount of $250,000 irrespective of the Company’s or your individual performance. Such payment will be made in or around March/April of 2005.
4.	A recommendation will be made to the Board of Directors to grant you 100,000 shares of nonqualified stock options at fair market value on your start date. Options have a four (4) year vesting, with 25% vested after the first year of service and subsequent monthly vesting thereafter consistent with an additional 25% vesting per year. In addition, you will be granted 25,000 additional shares of nonqualified stock options at fair market value at the time annual grants are made to employees, which is in or around March/April

Gerald Chaney Offer of Employment
October 25, 2004

	2005. These options shall have a separate four (4) year vesting schedule, as described herein.
5.	You will be eligible for a car allowance in the pretax amount of $7,200 annually, paid on a bi-weekly basis.
6.	You will be eligible for 4 weeks of paid vacation annually for your first five years of employment and 5 weeks annually thereafter.
7.	The Company will pay for reasonable and customary expenses in regard to your move from New Jersey to the Orange County area, consistent with the terms and conditions of the relocation benefits provided to executives. Relocation benefits are provided with the understanding, and a separately signed agreement, that costs associated with relocation will be reimbursed by you in the event that you leave the company within one year of employment, other than if such transition is through no fault of your own.
8.	You have indicated that you are under no contractual restrictions that would prevent you from accepting employment with the Company and are free to enter into this employment relationship.

You will be entitled to all other Company benefits provided to executives. Currently, those benefits include, but are not limited to, medical, dental, vision, basic and supplemental life and disability insurance. Additionally, we have available an executive deferred compensation plan with a number of different investment options. The Company reserves the right to periodically change benefits.

Gerry, we are extremely excited about the prospect of having you join our organization. Having you as part of our executive team will add a needed expertise and perspective that will assure us of the continued success of the company. We look forward to having your expertise and your impact on the business.

Sincerely,

/s/ ABBY S. AREINOFF

Abby S. Areinoff
Vice President, Human Resources

I acknowledge receipt and acceptance of the above offer of employment with Pacific Sunwear of California, Inc. In this capacity, my services would be exclusively retained by Pacific Sunwear foregoing all previous or future services elsewhere during my employment by the Company. I understand and acknowledge that Pacific Sunwear of California, Inc. is an at-will employer and that my employment may be terminated by the Company or me at any time, with or without prior notice or cause.

Upon acceptance of the above offer, please forward or fax a signed copy of page
two only to Human Resources at (714) 414-4260.

Signature:	/s/	GERALD M. CHANEY	Date: November 22, 2004
		Gerald M. Chaney

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EX-10.2

EXHIBIT 10.2

SEVERANCE AGREEMENT

This Severance Agreement (hereinafter “the Agreement”) is made and entered into between Pacific Sunwear of California, Inc., (hereinafter “the Company”) and Gerald M. Chaney (hereinafter “the Executive”).

WHEREAS, the Executive is to be employed by the Company in the capacity of Senior Vice President, Chief Financial Officer;

WHEREAS, the Company and the Executive wish to provide for the continuation of certain payments and benefits to the Executive upon termination of Executive’s employment under specified circumstances, and would like to set forth the terms relating to a release by Executive of any claims Executive may have against Company;

NOW, THEREFORE, in consideration of the mutual promises and covenants herein contained, and good and valuable other consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Post-Termination Benefits

a.

Salary. If the employment of Executive by Company is terminated without Cause, as defined herein, Executive shall continue to receive from the Company payment of Executive’s base salary for a period of twelve (12) months following the date of termination of Executive’s employment (“the Termination Date”). At the election of Company, such payments of base salary shall be payable to Executive on a bi-weekly basis and shall be subject to mitigation by any amounts earned by Executive from a subsequent employer during this period of time, or shall be paid in a lump-sum payment at the time of termination.

b.

Bonus. In addition to the foregoing, if the employment of executive is terminated by the Company without Cause, as defined herein, at any time during the fourth fiscal quarter of the year, the Company shall also pay to Executive in a single payment within 90 days of the end of the Company’s fiscal year, a prorata portion of the bonus payment that would otherwise have been received for that year. Such payment shall take into consideration only the company-performance component of the bonus payment and shall not include the individual-performance component of the bonus. The prorata portion of the bonus shall be based on the number of weeks of employment completed by the Executive during the fiscal year prior to the Termination Date.

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2.	Cause.
	For purposes of this Agreement, the term “Cause” shall mean:

(i)	Executive’s conviction of or entrance of a plea of guilty or nolo contendere to a felony; or
(ii)	Executive is engaging or has engaged in fraud, material dishonesty, or other acts of willful misconduct in connection with the business affairs of the Company; or
(iii)	Executive engages in theft, embezzlement, or other criminal misappropriation of funds from the Company; or
(iv)	there is gross negligence in the performance of Executive’s duties in his position of Senior Vice President, Chief Financial Officer.

3.	At-Will Employment.
	It is expressly understood and acknowledged by Executive that Executive’s employment by Company is “at will” and nothing in this Agreement alters the “at will” nature of the employment relationship. Executive acknowledges that the Company may terminate his employment at any time, with or without Cause; provided, however, that if the termination is without Cause, Executive will be entitled to the benefits described herein.
4.	Release Agreement
	It shall be a condition to the obligations of the Company to make the payments required hereunder that Executive execute and deliver to the Company an effective General Release Agreement with the Company, in substantially the form attached as Exhibit A (“the Release Agreement”), said agreement to become effective following all time constraints provided under the Older Workers Benefit Protection Act.
5.	Counterparts.
	This Agreement may be executed in one or more counterparts. All of such counterparts shall constitute one and the same agreement and shall become effective when a copy signed by each party has been delivered to the other party and all time conditions under the Older Worker Benefit Protection Act have passed without revocation of such signature.
6.	Miscellaneous.

a.	This Agreement constitutes the entire agreement of the parties hereto relating to the subject matter hereof, and there are no written or oral terms or representations made by either party other than those contained herein.
b.	This Agreement supersedes all prior agreements between the parties concerning the subject matter hereof.

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c.	This Agreement may only be amended in writing signed by both parties. No waiver by any party of any breach of this Agreement shall be deemed to be a waiver by any party of any preceding or succeeding breach.
d.	The validity, interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of California without regard to conflicts of law principles.
e.	The headings contained herein are for reference purposes only and shall not in any way affect the meaning or interpretation of the Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date indicated.

COMPANY:
Pacific Sunwear of California, Inc.
By:	/s/	GREG H. WEAVER	Date: November 22, 2004
		Greg H. Weaver Chairman/CEO
EXECUTIVE:
By:	/s/	GERALD M. CHANEY	Date: November 22, 2004
		Gerald M. Chaney

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Exhibit A

GENERAL RELEASE AGREEMENT

     THIS GENERAL RELEASE AGREEMENT (“the Release”) is made and entered into as of this    day of    ,    by Gerald M. Chaney (“Executive”) in favor of Pacific Sunwear of California, Inc.

     WHEREAS, the Company has, prior to the date hereof, employed Executive as a fulltime employee of the Company, but as of this date, Executive’s status as an employee has terminated; and

     WHEREAS, as a condition precedent to granting Executive certain severance benefits pursuant to that Severance Agreement (“the Agreement”) between Executive and the Company dated as of October 31st, 2004, the Company has required that Executive execute and deliver this Release in favor of the Company;

     NOW, THEREFORE, for and in consideration of the foregoing and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, Executive hereby agrees as follows:

     1. Release.

     a. Except with respect to the Company’s obligations pursuant to the Severance Agreement, any existing director or officer indemnification obligations and any retirement or similar benefits, if any, applicable or payable to Executive, Executive hereby unconditionally remises, releases and forever discharges to the fullest extent permitted by law, the Company, its employees, officers, directors, agents, affiliates, subsidiaries and each of them from all manner of actions, proceedings, causes of actions, claims, counterclaims, suits, debts, sums, monies, accounts, covenants, agreements, promises, damages, losses or demands of whatever kind or nature from the beginning of time to the present, whether known or unknown, in law or in equity, which in the past, now or in the future arise, may arise or allegedly arise or are in any way resulting from or in any manner connected with Executive’s employment by the Company and the termination of such employment by the Company. Executive waives all claims and causes of action against the Company and all damages, if any, that may be recoverable. This release and waiver of all claims and damages includes, but is not limited to, any tort or claim of wrongful discharge, and all rights under the federal, state or local laws prohibiting race, sex, age, religion, national origin, handicap, disability or other forms of discrimination, including but not limited to, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Family and Medical Leave Act, the California Fair Employment and Housing Act, the California Family Rights Act, or any other federal, state or local law, regulation or ordinance.

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     b. This Release is intended to be effective as a bar to every claim, demand, and cause of action stated above. Accordingly, Executive hereby expressly waives any rights and benefits conferred by Section 1542 of the California Civil Code, which provides that

“A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.”

2. Miscellaneous.

a. This Release embodies the entire agreement of the parties and supersedes all prior agreements between the parties hereto relating to the subject matter hereof.

b. The unenforceability or invalidity of any of the terms or provisions of this agreement shall not affect the validity or invalidity of any of the terms or provisions which shall be interpreted and construed in such manner as to carry out fully the intention of the parties hereto.

c. This Release shall be construed and enforced in accordance with the laws of the State of California.

d. Executive understands that by executing this release, Executive is giving up possible rights that he may have, and that Executive does not have to sign this release. This Release has been voluntarily and knowingly executed by Executive with the express intention of effecting the extinguishment of any and all obligations and damages that the Company may owe to Executive as provided herein, other than those described in the Severance Agreement, dated October 31, 2004.

3. Effective Waiver

a. Executive understands that the Executive has twenty-one (21) days to consider whether or not to execute this release. Executive understands that a portion of this release, solely relating to Executive’s rights under the Federal Age Discrimination in Employment Act, as amended, may be revoked by notifying the company in writing of such revocation within seven (7) days of execution of this release. The portion of this release relating solely to Executive’s rights under the Federal Age Discrimination in Employment act, as amended, is not effective until the expiration of such seven (7) day period. All parts of this release not relating to claims of age discrimination and alleged damages under the Age Discrimination in Employment Act, as amended, are

Page 5 of 6 10/31/04

effective immediately upon execution of this release. Executive understands that upon the expiration of such seven (7) day period, this release will become binding in its entirety upon the Executive and all portions thereof will be irrevocable.

b. Executive further understands that the rights accruing to Executive under the Severance Agreement previously entered into by Executive do not become due and owing until such time as this Release has been executed voluntarily and knowingly and the seven (7) day rescission period has expired, rendering the Release irrevocable.

IN WITNESS WHEREOF, Executive has duly executed this Release in favor of the Company as of the day and year first above written.

EXECUTIVE:

     Gerald M. Chaney

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EX-99.1

Frank Schools, VP of Finance (714) 414-4062

EXHIBIT 99.1

PACIFIC SUNWEAR APPOINTS GERALD M. CHANEY
OF POLO RALPH LAUREN TO SENIOR VICE PRESIDENT,
CHIEF FINANCIAL OFFICER

     ANAHEIM, CA November 19, 2004 -— Pacific Sunwear of California, Inc. (NASDAQ:PSUN — News) today announced the appointment of Gerald M. Chaney to the position of Senior Vice President, Chief Financial Officer effective Thursday, December 2, 2004.

     Mr. Chaney has been Senior Vice President of Finance and Chief Financial Officer of Polo Ralph Lauren since November 2000. Mr. Chaney has also been Chief Financial Officer of Kellwood Company and Petrie Retail, and held Director of Finance and Vice President of Finance positions at General Mills Fashion Group and Scott Paper.

     Mr. Chaney has a BS in Accounting from the University of South Alabama and an MBA from the University of Wisconsin.

     Pacific Sunwear is a leading specialty retailer of everyday casual apparel, accessories and footwear designed to meet the needs of active teens and young adults. As of October 30, 2004, the Company operated 727 PacSun stores, 84 PacSun outlet stores and 158 d.e.m.o. stores for a total of 969 stores in 50 states and Puerto Rico. PacSun’s website address is www.pacsun.com.

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3450 East Miraloma, Anaheim, CA 92806