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): March 21, 2005

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):

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

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

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

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

TABLE OF CONTENTS

	Item 1.01 Entry into a Material Definitive Agreement
	Item 9.01 Financial Statements and Exhibits.
SIGNATURES
EXHIBIT INDEX
EXHIBIT 10.1
EXHIBIT 10.2

Item 1.01 Entry into a Material Definitive Agreement

     On March 21, 2005, the Board of Directors of Pacific Sunwear of California, Inc. approved the performance targets to be used in the calculation of fiscal 2005 cash bonus payments for the Company’s named executive officers, as well as for other officers and certain other employees of the Company. The amount of any bonus payment to be made under these agreements is based primarily on the Company’s net income for fiscal 2005. For a discussion regarding fiscal 2005 cash bonus agreements, please refer to Exhibit 10.1 attached hereto, which is incorporated herein by reference. The bonus awards were granted subject to individual bonus award agreements, a form of which is attached hereto as Exhibit 10.2 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

     (c) Exhibits.

     10.1          Description of Fiscal 2005 Cash Bonus Agreements

     10.2          Form of Bonus Award Agreement

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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: March 24, 2005	Pacific Sunwear of California, Inc.
	/s/ GREG WEAVER
	Greg Weaver
	Chairman of the Board and Chief Executive Officer

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EXHIBIT INDEX

Exhibit No.	Description
10.1	Description of Fiscal 2005 Cash Bonus Agreements
10.2	Form of Bonus Award Agreement

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EX-10.1

Exhibit 10.1

DESCRIPTION OF FISCAL 2005
CASH BONUS ARRANGEMENTS

Under the Pacific Sunwear 1999 Stock Award Plan, the Company may grant cash performance awards. In 2005, the Company established criteria for performance-based bonus awards under the 1999 Stock Award Plan for the following executive officers:

Name	Title
Greg H. Weaver	Chairman of the Board and Chief Executive Officer
Seth R. Johnson	Chief Operating Officer
Timothy M. Harmon	President, Chief Merchandising Officer
Gerald M. Chaney	Senior Vice President, Chief Financial Officer
Thomas Kennedy	Division President, PacSun

In addition, the Company established a cash bonus plan for other officers and certain other employees. In each case, all or part of the bonus awards payable are based on the achievement of net income goals for the Company.

The Compensation Committee established the performance goals for each of the executive officers, and recommended to the Board of Directors for its approval the performance goals for other officers and employees. This committee also established the formulae for purposes of determining the actual award (if any) payable to such officers and employees assuming the performance goals are achieved.

The amount of the bonus payable to each of Mr. Weaver and Mr. Johnson is based solely on the Company’s level of net income for fiscal 2005. For each of the other participants, the primary portion of the bonus payable is based on the Company’s net income for fiscal 2005 and the remaining portion is discretionary based on individual performance.

EX-10.2

Exhibit 10.2

PACIFIC SUNWEAR OF CALIFORNIA, INC.
1999 STOCK AWARD PLAN
[YEAR] PERFORMANCE-BASED BONUS AWARD AGREEMENT

     THIS [YEAR] PERFORMANCE-BASED BONUS AWARD AGREEMENT (this “Agreement”) is entered into by and between PACIFIC SUNWEAR OF CALIFORNIA, INC., a California corporation (the “Company”), and [Executive Name] (the “Participant”) as of this ___day of ______, ___.

W I T N E S S E T H

     WHEREAS, the Company has adopted the Pacific Sunwear of California, Inc. 1999 Stock Award Plan, as amended and restated March 27, 2003 (the “Plan”); and

     WHEREAS, the Company’s Compensation Committee (the “Committee”) has determined that the Participant is eligible to be granted a Performance-Based Award pursuant to Section 5.2 of the Plan and has granted the Participant a Performance-Based Award upon the terms and conditions set forth herein and in the Plan (the “Award”); and

     WHEREAS, the Award has been granted to the Participant in addition to, and not in lieu of, any other form of compensation otherwise payable or to be paid to the Participant;

     NOW, THEREFORE, in consideration of the mutual promises and covenants made herein and the mutual benefits to be derived herefrom, the parties agree as follows:

1.	Capitalized Terms. Capitalized terms used herein and not otherwise defined herein shall have the meaning assigned to such terms in the Plan.
2.	Grant of Award. This Agreement evidences the Company’s grant to the Participant, subject to the terms and conditions hereof and of the Plan, of an Award with respect to the Company’s ___fiscal year (the “Performance Period”). The bonus payable in respect of the Award will be calculated under Appendix A hereto if the Performance Target set forth therein (minimum Net Income, as defined in the Plan, of the Company for the Performance Period) is achieved. The bonus payable in respect of the Award will increase, as set forth in Appendix A hereto, for certain levels of Net Income of the Company for the Performance Period in excess of the minimum Net Income of the Company for that period. No bonus will be payable if such minimum Net Income of the Company is not achieved for the Performance Period. For purposes of determining the Participant’s bonus in accordance with Appendix A, the Participant’s “Target Bonus” is $___. The maximum amount that will be paid pursuant to the Award shall not exceed the limitation contained in Section 5.2(c) of the Plan.
3.	Forfeiture of Award; Early Termination; Adjustment. Should the Participant’s employment by the Company terminate for any reason prior to the last day of the Performance Period, the Bonus payable in respect of the Award shall equal: (1) the amount that would otherwise have been paid in respect of the Award had the Participant

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	remained an employee of the Company throughout the Performance Period, multiplied by (2) a fraction of the numerator of which is the total number of days in the Performance Period that the Participant was as employee of the Company and the denominator of which is 365. Such amount shall otherwise be paid at the same time and on the same terms and conditions as though the Participant’s employment by the Company had not terminated.
4.	Continuance of Employment. Notwithstanding any commitment of the Participant to remain in the service or employ of the Company (or any affiliate), the Award shall not confer upon the Participant any right with respect to the continuation of his or her service or employment by the Company (or any affiliate) or alter or interfere in any way with the right of the Company (or any affiliate) at any time to terminate such service or employment or to change the compensation of the Participant or other terms of his or her service or employment; and neither shall these terms alter or in any way affect the rights of the Company (or any affiliate) or the Participant under any other written employment agreement between them, except as expressly provided herein.
5.	Timing and Manner of Payment. Subject to any changes imposed by or allowed under the provisions of the Plan, benefits with respect to the Award shall be calculated pursuant to Section 2 and Appendix A. The Committee shall determine, in accordance with such provisions and after the end of the Performance Period, the specific amount to the paid to the Participant with respect to this Award. No payment shall be made with respect to the Award unless and until the Committee has certified, by resolution or other appropriate action in writing, that the amount thereof has been accurately determined in accordance with the terms, conditions and limits of the Award and that the applicable Performance Target was, in fact, satisfied. Any amount payable with respect to the Award shall be paid in cash as soon as practicable following such certification by the Committee. No interest or other earnings shall be paid on or accrue with respect to such amount for the period between the end of the Performance Period and the date of actual payment.
6.	Adjustments. To preserve the intended incentives and benefits of the Award, the Committee shall (i) adjust the Performance Targets applicable to the Award to reflect any material change in corporate capitalization, any material corporate transaction (such as a reorganization, combination, separation, merger, acquisition, or any combination of the foregoing), or any complete or partial liquidation of the Company, (ii) calculate Performance Targets without regard for any change in accounting policies or practices affecting the Company and/or the Business Criteria or the Performance Targets, and (iii) adjust Business Criteria and Performance Targets or other features of an Award to reflect the effects of any special charges to the Company’s earnings; in each case only to the extent consistent with the requirements of Section 162(m) of the Code to qualify the Award as “qualified performance-based compensation” thereunder.
7.	Tax Withholding. The Company shall reduce any amount otherwise payable with respect to the Award by the amount of any federal, state and/or local income and/or employment tax withholding that may be required with respect to such payment.
8.	Dissolution of the Company, Certain Mergers. In the event of the dissolution of the Company or a merger, reorganization or other event in which the Company ceases to be a

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	publicly-traded company in respect of its Common Stock, the Committee may terminate the Performance Period as of or immediately prior to such event and pro-rate the Target Bonus and Performance Targets by multiplying each relevant amount by a fraction, the numerator of which is the number of days in the shortened Performance Period and the denominator of which is 365.
9.	Death of the Participant. If the Participant dies prior to receiving any payment due with respect to the Award (other than an amount deferred under a Company deferred compensation program, the payment of which shall be governed by the terms of such program), such payment shall be made to his designated beneficiary. A Participant’s designated beneficiary shall be the beneficiary designated by the Participant, in a manner determined by the Committee to receive amounts due the Participant in the event of his death. In the absence of an effective designation, a Participant’s designated beneficiary shall be deemed to be his or her spouse, or, if he or she has no spouse at the time of his or her death, his or her estate.
10.	Award Non-Transferable. Except as expressly provided in Section 9 above, the Award is non-transferable. No benefit payable with respect to the Award shall be subject in any manner to anticipation, alienation, sale, transfer, pledge, assignment, encumbrance or charge, and any such attempted action shall be void and no such benefit shall be in any manner liable for or subject to debts, contracts, liabilities, engagements or torts of the Participant. This Agreement shall, however, be binding upon any successor to all or substantially all of the business and/or assets of the Company.
11.	Governing Law. The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of California, without regard to the conflict of laws principles thereof.
12.	Amendment. This Agreement may only be amended in writing by an instrument signed by both parties. Adjustments pursuant to Section 6 shall not, however, be considered amendments requiring Participant consent.
13.	Construction. It is the intent of the Company that the Award satisfy and be interpreted in a manner that satisfies the applicable requirements under Section 162(m) of the Code to qualify the Award as “qualified performance-based compensation” thereunder. Any provision, application or interpretation of the Plan inconsistent with this intent to satisfy the standards in Section 162(m) of the Code shall be disregarded.
14.	General Terms. The Award and any payment in respect thereof are subject to, and the Company and the Participant agree to be bound by, the provisions of the Plan. The provisions of the Plan are incorporated herein by this reference. Provisions of the Plan that grant discretionary authority to the Committee or the Board shall not create any rights in the Participant, unless such rights are expressly set forth herein.

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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first written above.

PARTICIPANT
 
 
 

[Executive Name]

PACIFIC SUNWEAR OF
CALIFORNIA, INC.
a California Corporation

By:

Name:

Title:

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APPENDIX A

[YEAR] AWARD AGREEMENT

Name of Participant: [EXECUTIVE NAME]

		Percentage of Target
		Bonus Which Will be
		Paid If Specified Level
		of the Performance
	Performance	Target is Satisfied
Business Criteria*	Target Level	in the Performance Period**
Company “Net Income”
(as such term is defined
in the Plan) in $thousands

No portion of the Target Bonus shall be paid if the Company’s Net Income in $thousands for the Performance Period is less than the Performance Target of $___.

*	Net Income of the Company will be determined on a consolidated basis.
**	Amounts are not cumulative.

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