8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of report (Date of earliest event reported):
October 22, 2007

Pacific Sunwear of California, Inc.

(Exact name of registrant as specified in its charter)

California	0-21296	95-3759463
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

3450 East Miraloma Avenue, Anaheim, CA 92806-2101

(Address of principal executive offices) (Zip Code)

(714) 414-4000

(Registrant’s telephone number, including area code)

not applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (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 2.05 Costs Associated with Exit or Disposal Activities.
	Item 2.06 Material Impairments.
	Item 7.01 Regulation FD Disclosure.
	Item 9.01 Financial Statements and Exhibits.
SIGNATURES
EXHIBIT INDEX
EXHIBIT 99.1

Item 2.05 Costs Associated with Exit or Disposal Activities.

On October 22, 2007, the Board of Directors of Pacific Sunwear of California, Inc. (the “Company”) approved management’s recommendation to explore strategic alternatives for the Company’s demo stores and to close its One Thousand Steps stores. The Company plans to engage an investment banker to assist in identifying and evaluating strategic alternatives for the 154 demo stores and to close the nine One Thousand Steps stores as soon as is practical.

The determination to take these actions resulted from a comprehensive review and evaluation of the real estate portfolio and profit performance of the Company’s demo and One Thousand Steps stores. The demo and One Thousand Steps stores collectively have generated a total pre-tax operating loss of approximately $21 million during the first three quarters of fiscal 2007 (excluding previously announced lease termination and asset impairment charges).

As a result of these actions, the Company estimates that it will recognize non-cash fixed asset impairment charges on demo stores of approximately $48 million and inventory reserve charges for demo and One Thousand Steps aggregating approximately $4 million in its third quarter ending November 3, 2007. The Company may incur additional charges, both cash and non-cash, in the future related to potential lease terminations and related costs, inventory liquidation costs, employee retention and severance obligations, and/or agency fees associated with the evaluation or implementation of potential strategic alternatives. The actual amounts and timing of such charges, if any, will not be known until various strategic alternatives are evaluated and a definitive course of action is determined.

Item 2.06 Material Impairments.

The response to Item 2.05 is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

The full text of the Company’s press release announcing its plans regarding the demo and One Thousand Steps store concepts is furnished as Exhibit 99.1 to this Current Report.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits

Exhibit
Number	Description
99.1	Press Release, dated October 24, 2007, regarding the Company’s demo and One Thousand Steps store concepts

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.

	PACIFIC SUNWEAR OF CALIFORNIA, INC.
Date: October 24, 2007	By:	/s/ GERALD M. CHANEY
		Gerald M. Chaney
		Senior Vice President, Chief Financial Officer and Secretary

EXHIBIT INDEX

Exhibit
Number	Description
99.1	Press Release, dated October 24, 2007, regarding the Company’s demo and One Thousand Steps store concepts

EX-99.1

EXHIBIT 99.1

Contact:
Gar Jackson
Sr. Director Investor Relations
(714) 414-4049

FOR IMMEDIATE RELEASE

PACIFIC SUNWEAR TO EXPLORE STRATEGIC ALTERNATIVES FOR ITS DEMO
STORES; ANNOUNCES PLANS TO CLOSE ITS ONE THOUSAND STEPS STORES

ANAHEIM, CA October 24, 2007 -— Pacific Sunwear of California, Inc. (NASDAQ:PSUN, the “Company”) today announced that it will explore strategic alternatives for the Company’s demo stores and close its One Thousand Steps stores. The determination to take these actions resulted from a comprehensive review and evaluation of the real estate portfolio and profit performance of the Company’s demo and One Thousand Steps stores. The Company plans to engage an investment banker to assist in identifying and evaluating strategic alternatives for the demo stores and close the One Thousand Steps stores as soon as is practical.

“We believe the best way to enhance shareholder value at this time is to focus management’s attention and capital on the core PacSun business. Over the past two years, our demo team has made many efforts to improve this business. However, as is evidenced by our demo division comp store sales, the urban streetwear business has been very challenging. At this time, the Board has chosen to explore strategic alternatives for this division,” stated Sally Frame Kasaks, Chief Executive Officer of Pacific Sunwear.

“Regarding One Thousand Steps, we learned a great deal from our nine-store test, and have concluded that our shareholders are unlikely to benefit from the continued operation of this division,” Kasaks concluded.

The demo and One Thousand Steps stores collectively have generated a total pre-tax operating loss of approximately $21 million during the first three quarters of fiscal 2007 (excluding previously announced lease termination and asset impairment charges). As a result of the actions announced today, the Company estimates that it will recognize non-cash fixed asset impairment charges on demo stores of approximately $48 million and inventory reserve charges for demo and One Thousand Steps aggregating approximately $4 million in its third quarter ending November 3, 2007. The Company may incur additional charges, both cash and non-cash, in the future related to potential lease terminations and related costs, inventory liquidation costs, employee retention and severance obligations, and/or agency fees associated with the evaluation or implementation of potential strategic alternatives. The actual amounts and timing of such charges, if any, will not be known until various strategic alternatives are evaluated and a definitive course of action is determined.

About Pacific Sunwear of California, Inc.
Pacific Sunwear, operating under three distinct retail concepts, 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 24, 2007, the Company operated 837 PacSun stores, 119 PacSun Outlet stores, 154 demo stores and 9 One Thousand Steps stores for a total of 1,119 stores in 50 states and Puerto Rico. PacSun’s website address is www.pacsun.com, merchandise carried at

3450 East Miraloma Avenue • Anaheim, CA 92806 • (714) 414-4000

demo stores can be found at www.demostores.com and information about One Thousand Steps can be found at www.onethousandsteps.com.

Pacific Sunwear Safe Harbor

This press release contains “forward-looking statements,” including statements with respect to the Company’s plans to explore strategic alternatives for its demo stores and to close its One Thousand Steps stores, the amount and timing of related asset impairment and other costs and charges, and the enhancement of shareholder value through the focusing of management’s attention and capital on the core PacSun business. In each case, these statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company intends that these forward-looking statements be subject to the safe harbors created thereby. These statements are subject to risks, uncertainties, and other factors, including, among others, risks, uncertainties and factors set forth in our reports and documents filed with the United States Securities and Exchange Commission, including but not limited to the Annual Report on Form 10-K for the year ended February 3, 2007 and subsequent periodic reports filed with the SEC. We believe that all forward-looking statements are based on reasonable assumptions when made; however, we caution that it is impossible to predict actual results or outcomes or the effects of risks, uncertainties or other factors on anticipated results or outcomes. In particular, the timing and amount of actual charges and expenses relating to the Company’s demo and One Thousand Steps stores may differ from our initial estimates as plans and activities are finalized. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company assumes no obligation to update or revise any such forward-looking statements to reflect events or circumstances that occur after such statements are made. Nonetheless, the Company reserves the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this press release. No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates.